AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION
OF
POWERFLEET,
INC.
Pursuant
to Sections 242 and 245 of
the General Corporation Law of the State of Delaware
The
undersigned, Chris Wolfe, certifies that he is the Chief Executive Officer and President of PowerFleet, Inc. (the “Corporation”),
a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware,
as from time to time amended, and does hereby further certify as follows:
1.
The name of the Corporation is PowerFleet, Inc. The original Certificate of Incorporation of the Corporation was originally filed
with the Secretary of State of the State of Delaware on February 21, 2019 (the “Initial Certificate of Incorporation”).
2.
The Board of Directors of the Corporation duly adopted resolutions proposing to amend and restate the Initial Certificate of Incorporation
in the form hereof, declaring said amendment and restatement to be advisable and in the best interests of the Corporation and
its stockholders and submitting the proposed amendment and restatement to the stockholders of the Corporation for consideration
thereof.
3.
This Amended and Restated Certificate of Incorporation was approved by the written consent of the stockholders of the Corporation
holding the requisite number of outstanding shares of the stock of the Corporation in accordance with Section 228 of the General
Corporation Law of the State of Delaware.
4.
The text of the Initial Certificate of Incorporation is hereby amended and restated to read in its entirety as follows:
FIRST.
The name of this corporation is PowerFleet, Inc. (the “Corporation”).
SECOND.
The registered office of the Corporation in the State of Delaware is located at 160 Greentree Drive, Suite 101, Dover Delaware
19904, County of Kent. The name of its registered agent is National Registered Agents, Inc.
THIRD.
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the
General Corporation Law of the State of Delaware.
FOURTH.
As used herein, the following terms shall have the following meanings:
“Additional
Consideration” has the meaning set forth in Section A.3.c.ii.(4) of Article Fifth.
“Additional
Securities” has the meaning set forth in Section A.8.a of Article Fifth.
“Affiliate”
means “Affiliate” as defined in Rule 405 of the Securities Act of 1933, as amended.
“Associate”
means “Associate” as defined in Rule 405 of the Securities Act of 1933, as amended.
“Available
Proceeds” has the meaning set forth in Section A.3.c.i of Article Fifth.
“Bank
Change of Control” means any “change of control” (as may be defined from time to time in any agreement
governing indebtedness of the Corporation or any of its subsidiaries) that entitles the lender(s) thereunder to declare an event
of default under such agreement or that constitutes an event of default or default under such agreement, which shall be deemed
to occur (i) (x) in the case of a replacement of a majority of the Corporation’s (or such subsidiary’s) board of directors
(or similar governing body), upon the twentieth (20th) calendar day during the continuance thereof, unless the lender(s) accelerate,
or provide notice to accelerate such indebtedness, in which case, such Bank Change of Control shall be deemed to occur immediately
upon the first to occur of any of such events, and (y) in all other cases, immediately thereupon and (ii) in any such cases, provided,
that, if any such event ceases to continue prior to the twentieth (20th) calendar day of the occurrence or deemed occurrence thereof,
a Deemed Liquidation Event shall no longer be deemed to have occurred.
“Board”
means the board of directors of the Corporation.
“Bylaws”
has the meaning set forth in Section A.4.d.ii of Article Fifth.
“Closing
Bid Price” means the last closing bid price for the Common Stock on the Principal Market (or, if the Common Stock
is not traded on the Principal Market, on the Eligible Market on which the Common Stock is then traded), as reported by Bloomberg,
L.P., or, if the Principal Market (or, if the Common Stock is not traded on the Principal Market, on the Eligible Market on which
the Common Stock is then traded) begins to operate on an extended hours basis and does not designate the closing bid price or
the closing trade price, as the case may be, then the last bid price of the Common Stock prior to 4:00 p.m., New York Time, as
reported by Bloomberg, L.P., or if the foregoing do not apply, the average of the bid prices of any market makers for the Common
Stock as reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.).
“Common
Stock” has the meaning set forth in Article Fifth.
“Conversion
Notice” has the meaning set forth in Section A.5.a.ii of Article Fifth.
“Conversion
Rights” has the meaning set forth in Section A.5 of Article Fifth.
“Corporation”
has the meaning set forth in Article First.
“day”
means a calendar day, unless “business day” is expressly stated, in which case, business day shall refer to each day
on which banks are authorized or required by applicable law to be open for business in the State of New York.
“Debt
Securities” means each security of the Corporation, including without limitation, non-convertible preferred stock
and convertible debt, that is not an Equity Security.
“Deemed
Liquidation Event” has the meaning set forth in Section A.3.c.i of Article Fifth.
“Deemed
Liquidation Event Notice” has the meaning set forth in Section A.3.c.ii.(2) of Article Fifth.
“Definitive
Agreement” has the meaning set forth in Section A.3.c.ii.(1) of Article Fifth.
“Dividend
Payment Date” has the meaning set forth in Section A.2.b of Article Fifth.
“Dividend
Payment Failure” means, with respect to any Preferred Dividends, the failure of the Corporation to pay in full (whether
by issuance of PIK Shares or in cash, as the case may be) such Preferred Dividends to the holders of Series A Preferred Stock
within five (5) business days after the applicable Dividend Payment Date in accordance with the terms of Section A.2 of
Article Fifth.
“Dividend
Rate” has the meaning set forth in Section A.2.a.i of Article Fifth.
“Dividends”
has the meaning set forth in Section A.2.a.ii of Article Fifth.
“Eligible
Market” means any of the following: the Principal Market, the New York Stock Exchange, the NYSE MKT, the NASDAQ
Global Select Market, the NASDAQ Capital Market or the OTC Bulletin Board (or any successors to any of the foregoing).
“Equity
Securities” means any class or series of capital stock of the Corporation (other than Preferred Stock that is not,
directly or indirectly, convertible into, exchangeable or exercisable for, Common Stock or a security that itself is not convertible
into, exchangeable or exercisable for, Common Stock), and all securities that are convertible into, exchangeable or exercisable
for, and all rights, warrants and options to acquire, any of the foregoing; provided that any security that has a fixed maturity,
redemption or repayment, or that entitles the holder(s) thereof to require, whether subject to condition, notice or lapse of time,
the Corporation or a subsidiary of the Corporation to redeem, retire, repay or defease, in whole or in part, such as, but not
in limitation, convertible debt, shall be deemed a Debt Security and not an Equity Security.
“Exchange
Act” has the meaning set forth in Section A.2.c of Article Fifth.
“Indemnified
Person” has the meaning set forth in Section A of Article Eleventh.
“Initial
Consideration” has the meaning set forth in Section A.3.c.ii.(4) of Article Fifth.
“Issuance
Date” means the date on which shares of Series A Preferred Stock are issued by the Corporation, as applicable.
“Issuance
Notice” has the meaning set forth in Section A.8.b.i of Article Fifth.
“Junior
Stock” has the meaning set forth in Section A.1.a of Article Fifth.
“Mandatory
Conversion Notice” has the meaning set forth in Section A.5.b.i of Article Fifth.
“Mandatory
Conversion Time” has the meaning set forth in Section A.5.b.i of Article Fifth.
“Mandatory
Redemption Date” has the meaning set forth in Section A.6.a.i of Article Fifth.
“Mandatory
Redemption Notice” has the meaning set forth in Section A.6.a.ii of Article Fifth.
“Observer”
has the meaning set forth in Section A.4.d.ii of Article Fifth.
“Optional
Conversion Time” has the meaning set forth in Section A.5.a.ii of Article Fifth.
“Optional
Redemption Date” has the meaning set forth in Section A.6.b.i of Article Fifth.
“Optional
Redemption Notice” has the meaning set forth in Section A.6.b.i of Article Fifth.
“Original
Issuance Date” means the date on which any shares of Series A Preferred Stock are first issued by the Corporation.
“Participating
Dividends” has the meaning set forth in Section A.2.a.ii of Article Fifth.
“PIK
Shares” has the meaning set forth in Section A.2.a.i of Article Fifth.
“Porsche
Merger Agreement” has the meaning ascribed to such term in the Purchase Agreement.
“Preferred
Dividend Payment Date” has the meaning set forth in Section A.2.b of Article Fifth.
“Preferred
Dividend Period” has the meaning set forth in Section A.2.b of Article Fifth.
“Preferred
Dividends” has the meaning set forth in Section A.2.a.i of Article Fifth.
“Preferred
Stock” has the meaning set forth in Article Fifth.
“Principal
Market” means the NASDAQ Global Market.
“Pro
Rata Share” has the meaning set forth in Section A.8.b.ii of Article Fifth.
“Proceeding”
has the meaning set forth in Section A of Article Eleventh.
“Purchase
Agreement” means the Investment and Transaction Agreement, dated as of March 13, 2019, by and among the Corporation,
the Requisite Investors, as the initial holders of shares of Series A Preferred Stock, and the other parties signatory thereto,
as amended, modified or supplemented from time to time in accordance with its terms.
“Redemption
Failure” has the meaning set forth in Section A.6.b.ii of Article Fifth.
“Redemption
Price” means, as of the date of determination, with respect to a share of Series A Preferred Stock, the greater
of: (i) the product of (x) 1.5 multiplied by (y) the sum of (A) Series A Issue Price, plus (B) any Preferred Dividends (assuming
a cash election were made, whether or not permitted hereunder) accrued but unpaid thereon, whether or not declared, plus (C) any
other dividends declared but unpaid thereon; and (ii) the product of (x) the number of shares of Common Stock issuable upon conversion
of such share of Series A Preferred Stock calculated using the then current Series A Conversion Price multiplied by (y) the VWAP
during the thirty (30) consecutive Trading Day period ending on the specified reference date, except if the Redemption Price is
being calculated in connection with a Deemed Liquidation Event, then the dollar amount of this clause (ii)(y) shall be the value
ascribed to a share of Common Stock in such Deemed Liquidation Event. If any dividends described in clause (i)(y)(C), or any of
the consideration for the Common Stock in a Deemed Liquidation Event, are payable other than in cash, the dollar value thereof
shall be determined by the Board in good faith, without taking into account any discounts for illiquidity, marketability, minority
or similar limitations.
“Requisite
Investors” means ABRY Senior Equity V, L.P. and ABRY Senior Equity Co-Investment Fund V, L.P., and also includes
any of their respective (i) Affiliates to whom Series A Preferred Stock is transferred and (ii) limited partners to whom Series
A Preferred Stock is transferred in connection with a liquidating distribution.
“Sale
Period” has the meaning set forth in Section A.6.b.iii of Article Fifth.
“Sale
Transaction” has the meaning set forth in Section A.6.b.ii of Article Fifth.
“SEC”
means the U.S. Securities and Exchange Commission.
“Selected
Bid” has the meaning set forth in Section A.6.b.ii of Article Fifth.
“Series
A Conversion Price” has the meaning set forth in Section A.5.a.i of Article Fifth.
“Series
A Directors” has the meaning set forth in Section A.4.d.ii of Article Fifth.
“Series
A Issue Price” means, with respect to a share of Series A Preferred Stock, $1,000.00, which shall be subject to
ratable adjustment in the case of stock dividends (other than the Preferred Dividends), stock splits, reverse stock splits, combinations,
divisions and reclassifications affecting the Series A Preferred Stock, with all such adjustments to be reasonably determined
in good faith by the Board.
“Series
A Liquidation Amount” has the meaning set forth in Section A.3.a of Article Fifth.
“Series
A Preferred Stock” has the meaning set forth in Article Fifth.
“Series
A Preferred Stock Register” has the meaning set forth in Section A.1.b of Article Fifth.
“Series
A Voting Activation Notice” has the meaning set forth in Section A.4.a of Article Fifth.
“Series
A Voting Deactivation Notice” has the meaning set forth in Section A.4.a of Article Fifth.
“Trading
Day” means any day on which the Common Stock is traded on the Principal Market (or, if not traded on the Principal
Market, on the Eligible Market on which the Common Stock is then traded); provided that “Trading Day” shall not include
any day on which the Common Stock is scheduled to trade on the Principal Market (or, if not traded on the Principal Market, in
any applicable Eligible Market) for less than 4.5 hours or any day that the Common Stock is suspended from trading during the
final hour of trading on the Principal Market (or, if not traded on the Principal Market, on the Eligible Market on which the
Common Stock is then traded) (or if the Principal Market (or, if not traded on the Principal Market, on the Eligible Market on
which the Common Stock is then traded) does not designate in advance the closing time of trading on such exchange or market, then
during the hour ending at 4:00 p.m., New York Time).
“Transaction
Committee” has the meaning set forth in Section A.6.b.ii of Article Fifth.
“VWAP”
means, on any particular Trading Day or for any particular period, the volume weighted average trading price per share of Common
Stock on such date or for such period on the Principal Market (or, if not traded on the Principal Market, on the Eligible Market
on which the Common Stock is then traded) as reported by Bloomberg L.P., through its “Volume at Price” functions,
or, if the foregoing does not apply, the average of the highest Closing Bid Price and the lowest closing ask price of any of the
market makers for the Common Stock as reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation
Bureau, Inc.); provided, however, that during any period the VWAP is being determined, the VWAP shall be subject
to adjustment from time to time for stock splits, stock dividends, combinations and similar events, as applicable.
FIFTH.
The total number of shares of all classes of stock that the Corporation shall have the authority to issue is 75,150,000 shares,
consisting of:
(a)
75,000,000 shares of Common Stock, $0.01 par value per share (“Common
Stock”); and
(b)
150,000 shares of Preferred Stock, $0.01 par value per share (“Preferred
Stock”), of which 100,000 shares of Preferred Stock shall be designated Series A Convertible
Preferred Stock (“Series A Preferred Stock”) and 50,000 shares of
Preferred Stock shall initially be undesignated.
The
Board is expressly authorized at any time, subject to compliance with all applicable provisions of this Certificate of Incorporation,
to provide for the issuance of shares of Preferred Stock in one or more series in a resolution or resolutions duly adopted by
it, and by filing a certificate of designations pursuant to the applicable law of the State of Delaware, to establish from time
to time the number of shares to be included in each such series, and to fix the designations, powers, preferences, and rights
of the shares of each such series and any qualifications, limitations or restrictions thereof, including without limitation the
following:
(i)
the distinctive serial designation of such series that shall distinguish it from other series;
(ii)
the number of shares of such series, which number the Board may thereafter (except where otherwise provided in the certificate
of designations) increase or decrease (but not below the number of shares of such shares then outstanding);
(iii)
whether dividends shall be payable to the holders of the shares of such series and, if so, the basis on which such holders shall
be entitled to receive dividends (which may include, without limitation, a right to receive such dividends or distributions as
may be declared on the shares of such series by the Board, a right to receive such dividends or distributions, or any portion
or multiple thereof, as may be declared on the Common Stock or any other class of stock or, in addition to or in lieu of any other
right to receive dividends, a right to receive dividends at a particular rate or at a rate determined by a particular method,
in which case, such rate or method of determining such rate as may be set forth), the form of such dividend, any conditions on
which such dividends shall be payable and the date or dates, if any, on which such dividends shall be payable;
(iv)
whether dividends on the shares of such series shall be cumulative and, if so, the date or dates or method of determining the
date or dates from which dividends on the shares of such series shall be cumulative;
(v)
the amount or amounts, if any, which shall be payable out of the assets of the Corporation to the holders of the shares of such
series upon the voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, and the relative rights of
priority, if any, of payment of the shares of such series;
(vi)
the price or prices (in cash, securities or other property or a combination thereof) at which, the period or periods within which
and the terms and conditions upon which the shares of such series may be redeemed, in whole or in part, at the option of the Corporation
or at the option of the holder or holders thereof or upon the happening of a specified event or events;
(vii)
whether or not the shares of such series shall be convertible or exchangeable, at any time or times at the option of the holder
or holders thereof or at the option of the Corporation or upon the happening of a specified event or events, into shares of any
other class or classes or any other series of the same or any other class or classes of stock of the Corporation or any other
securities or property of the Corporation or any other entity, and the price or prices (in cash, securities or other property
or a combination thereof) or rate or rates of conversion or exchange and any adjustments applicable thereto;
(viii)
whether or not the holders of the shares of such series shall have voting rights, and if so, the terms of such voting rights,
which may provide, among other things and subject to the other provisions of this Certificate of Incorporation, that each share
of such series shall carry one vote or more or less than one vote per share, that the holders of such series shall be entitled
to vote on certain matters as a separate class (which for such purpose may be comprised solely of such series or of such series
and one or more other series or classes of stock of the Corporation) and that all the shares of such series entitled to vote on
a particular matter shall be deemed to be voted on such matter in the manner that a specified portion of the voting power of the
shares of such series or separate class are voted on such matter; and
(ix)
any other relative, participating, optional or other special rights, powers or preferences of such series, and any qualifications,
limitations or restrictions thereof.
For
all purposes, this Certificate of Incorporation shall include each certificate of designations (if any) setting forth the terms
of a series of Preferred Stock. Subject to the rights, if any, of the holders of any series of Preferred Stock set forth in this
Certificate of Incorporation or a certificate of designation(s), an amendment of this Certificate of Incorporation to increase
or decrease the number of authorized shares of a series of Preferred Stock (but not below the number of shares thereof then outstanding)
may be adopted and approved by resolution duly adopted by the Board.
The
following is a statement of the designations and the powers, privileges and rights, and the qualifications, limitations or restrictions
thereof in respect of each class of capital stock of the Corporation.
A.
SERIES A PREFERRED STOCK
The
rights, preferences, privileges, restrictions and other matters relating to the Series A Preferred Stock are as follows:
1.
Preference and Ranking, Amount and Par Value; Assignment.
a.
The preferences of each share of Series A Preferred Stock with respect to dividend payments and distributions of the Corporation’s
assets upon any voluntary or involuntary liquidation, dissolution or winding up of the Corporation or a Deemed Liquidation Event
or otherwise shall be equal to the preferences of every other share of Series A Preferred Stock from time to time outstanding
in every respect. The Series A Preferred Stock shall, with respect to dividends and distributions upon any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation or a Deemed Liquidation Event or otherwise, rank prior to all classes
of Common Stock of the Corporation and to each other class of capital stock or series of Preferred Stock hereafter created, the
terms of which do not expressly provide that it ranks prior to or pari passu with the Series A Preferred Stock as to dividends
and distributions upon a voluntary or involuntary liquidation, dissolution or winding up of the Corporation or a Deemed Liquidation
Event (including all securities that are convertible into, exchangeable or exercisable for, and all rights, warrants and options
to acquire, any of the foregoing, “Junior Stock”). On and after a Redemption Failure, until such time
as the redemption process to which such Redemption Failure relates, including the payment in full of the aggregate Redemption
Price payable, has been completed in accordance with Section A.6, no other Equity Securities or Debt Securities shall be
permitted to rank senior to, or pari passu with, the Series A Preferred Stock without express written approval of the holders
of at least a majority of the outstanding shares of Series A Preferred Stock unless the proceeds of the sale of such Equity Securities
and/or Debt Securities are used to so complete such redemption process.
b.
The Corporation shall register the issuance of shares of Series A Preferred Stock, upon records to be maintained by the Corporation
for that purpose (the “Series A Preferred Stock Register”), in the name of the holders of Series A Preferred
Stock from time to time. The Corporation may deem and treat the registered holders of Series A Preferred Stock as the absolute
owner thereof for the purpose of any conversion or redemption thereof and for all other purposes. Shares of Series A Preferred
Stock may be issued solely in book-entry form or, if requested by any holder of Series A Preferred Stock, such holder’s
shares may be issued in certificated form. The Corporation shall register the transfer of any shares of Series A Preferred Stock
in the Series A Preferred Stock Register, upon delivery to the Corporation of a stock power or other writing reasonably acceptable
to the Corporation duly executed by the then registered holder thereof, together in the case of certificated form, with surrender
of the certificates evidencing such share to be transferred, duly endorsed by the holder thereof, to the Corporation at its address
specified herein. Upon any such registration of the transfer of shares of Series A Preferred Stock, a book-entry notation (or,
to the extent such shares are certificated or if requested by the transferee, a new certificate) evidencing the shares of Series
A Preferred Stock so transferred shall be issued to the transferee and a book-entry notation (or, to the extent such shares are
certificated or if requested by the transferring holder, a new certificate) evidencing the remaining portion of the shares not
so transferred, if any, shall be issued to the transferring holder, in each case, within three (3) business days. The provisions
of this Certificate of Incorporation are intended to be for the benefit of all holders of Series A Preferred Stock from time to
time and shall be enforceable by any such holder as an express intended third party beneficiary hereof.
2.
Dividend Rights.
a.
Each holder of the then outstanding shares of Series A Preferred Stock, in preference and prior to the holders of all other classes
of stock of the Corporation, shall be entitled to receive:
i.
on each share of Series A Preferred Stock, dividends at an initial rate of 7.5% per annum (the “Dividend Rate”)
of the Series A Issue Price (subject to adjustment as set forth herein), accrued daily and compounded quarterly from and after
the applicable Issuance Date of each such share of Series A Preferred Stock (the “Preferred Dividends”),
which shall be payable (subject to Sections A.2.c and A.5.b.i) by the Corporation issuing and delivering to each
such holder of Series A Preferred Stock a number of additional fully paid and non-assessable shares of Series A Preferred Stock
or fraction thereof (“PIK Shares”) equal to the quotient (calculated to the fourth decimal place) of
(i) the aggregate dollar amount of the Preferred Dividend payable, divided by (ii) the then current Series A Issue Price; and
ii.
when, as and if declared by the Board, out of any funds legally available therefor, dividends on shares of Series A Preferred
Stock equal (on an as-converted-to-Common-Stock basis) to and in the same form as dividends (other than dividends in the form
of Common Stock, which shall be made in accordance with Section A.5.f) declared on shares of Common Stock when, as and
if such dividends are paid on shares of Common Stock (the “Participating Dividends” and, together with
the Preferred Dividends, the “Dividends”).
Commencing
on the sixty sixth (66)-month anniversary of the Original Issuance Date and on each monthly anniversary thereafter, the Dividend
Rate shall increase by 100 basis points, until the Dividend Rate reaches 17.5% per annum, provided, however, that
up to three (3) such consecutive monthly increases may be deferred if, and for so long as it remains in effect (but, in any event,
not longer than three (3) consecutive months, provided, that, following the cessation of any such deferral, the Dividend Rate
shall be re-calculated to the amount it would have been at such time had no such deferral occurred), a bona fide written letter
of intent is entered into with any third party who is not an Affiliate of the Corporation, evidenced by the execution by the Corporation
and such third party and delivery thereof by the Corporation, of a full and complete copy thereof to the holders of Series A Preferred
Stock prior to any such deferral, where the primary purpose of such letter of intent is the consummation of a Deemed Liquidation
Event.
The
Corporation will not declare or pay any dividends or other distributions on any Junior Stock that would require a Participating
Dividend, unless it first declares and pays the Preferred Dividends and concurrently therewith declares and sets aside for payment
or distribution, as applicable, and then pays, such Participating Dividend for all shares of Series A Preferred Stock then outstanding.
Each share of Series A Preferred Stock issued as a PIK Share shall be entitled to all Dividends payable with respect to each other
share of Series A Preferred Stock, irrespective of the fact that it was issued as a PIK Share.
b.
Preferred Dividends shall be cumulative and shall accrue and accumulate daily and compound quarterly for each share of Series
A Preferred Stock commencing on the applicable Issuance Date and be payable quarterly in arrears on March 31, June 30, September
30 and December 31 of each year commencing on the first of such dates occurring after the Original Issuance Date (each a “Preferred
Dividend Payment Date”) and the period from the applicable Issuance Date to the first Preferred Dividend Payment
Date and from the day after a Preferred Dividend Payment Date to the subsequent Preferred Dividend Payment Date being a “Preferred
Dividend Period”). Participating Dividends shall be payable as and when paid to the holders of Junior Stock (each
such date together with each Preferred Dividend Payment Date, a “Dividend Payment Date”). Preferred
Dividends that are payable on Series A Preferred Stock in respect of any Preferred Dividend Period shall be computed on the basis
of a 360-day year consisting of twelve (12), thirty (30)-day months. The amount of Preferred Dividends payable on Series A Preferred
Stock on any date prior to the end of a Preferred Dividend Period, and for the initial Preferred Dividend Period, shall be computed
on the basis of a 360-day year consisting of twelve (12), thirty (30)-day months, and actual days elapsed over a thirty (30)-day
month, and for the period that Series A Preferred Stock is outstanding. Preferred Dividends, whether or not declared, shall accumulate,
whether or not in any Preferred Dividend Period there have been funds of the Corporation legally available for the payment of
such Preferred Dividends. Participating Dividends are payable on a cumulative basis once declared, whether or not there shall
be funds legally available for the payment thereof.
c.
In lieu of the payment of any Preferred Dividend in PIK Shares on a Preferred Dividend Payment Date, provided that (i) no Dividend
Payment Failure has occurred and is continuing and (ii) there has not previously occurred two (2) or more Dividend Payment Failures,
the Corporation may elect, unless the Corporation is prohibited from doing so by applicable law or the terms of any indebtedness,
credit agreement, indenture or similar instrument of the Corporation or any of its subsidiaries (without giving effect to any
waiver thereof, unless such waiver is irrevocable and has been obtained prior to the Corporation making such election without
the payment of any material fees) to pay all but not less than all of such Preferred Dividend in cash out of any funds immediately
legally available therefor. Between sixty (60) and thirty (30) days prior to the applicable Preferred Dividend Payment Date (time
being of the essence), if the Corporation is permitted to and does so elect, then the Corporation shall send written notice to
each holder of Series A Preferred Stock of the Corporation’s election to pay the Preferred Dividend in cash out of funds
immediately legally available therefor. If so elected, the Corporation shall pay such Preferred Dividend in cash to the holders
of Series A Preferred Stock on the applicable Preferred Dividend Payment Date by wire transfer of immediately available funds
to an account designated by such holder (or by good check, subject to collection, if so requested by any such holder); provided,
however, in the event of a Dividend Payment Failure in respect of any such Preferred Dividends, such election shall be
automatically, without further action, notice or deed, revoked and the Corporation shall pay such Preferred Dividend by issuing
and delivering to each holder of Series A Preferred Stock, no later than three (3) Business Days after the applicable Preferred
Dividend Payment Date, the number of PIK Shares that would have been payable to such holder pursuant to Section A.2.a.i
if such election had not been made. The Corporation’s election under this Section A.2.c shall be made, with respect
to an applicable Preferred Dividend Payment Date, for all but not less than all outstanding shares of Series A Preferred Stock,
and shall not require the Corporation to make a similar election with respect to any future Preferred Dividend Payment Date. Any
election by the Corporation pursuant to this Section A.2.c shall be made by a committee of the Board, comprised entirely
of “independent” members of the Board as determined in accordance with the Listing Rules of the NASDAQ Stock Exchange
and applicable rules and regulations promulgated under federal securities laws, including but not limited to Rule 10A-3 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) and excluding any directors elected
pursuant to Section A.4.d.
3.
Liquidation, Dissolution or Winding Up; Certain Mergers, Consolidations and Asset Sales.
a.
Preferential Payments to Holders of Series A Preferred Stock. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of shares of Series A Preferred Stock then outstanding shall be entitled
to be paid out of the assets of the Corporation available for distribution to its stockholders, before any payment shall be made
to the holders of Junior Stock by reason of their ownership thereof, an amount per share equal to the greater of (i) the Series
A Issue Price, plus any Preferred Dividends accrued but unpaid thereon, whether or not declared, together with any other dividends
declared but unpaid thereon, or (ii) such amount per share as would have been payable had all shares of Series A Preferred Stock
been converted into Common Stock pursuant to Section A.5 immediately prior to such liquidation, dissolution, or winding
up (the amount payable pursuant to this sentence is hereinafter referred to as the “Series A Liquidation Amount”).
If upon any such liquidation, dissolution or winding up of the Corporation, the assets of the Corporation legally available for
distribution to its stockholders shall be insufficient to pay the holders of shares of the Series A Preferred Stock the full amount
to which they shall be entitled under this Section A.3.a, the holders of shares of Series A Preferred Stock shall share
ratably in any distribution of the assets legally available for distribution in proportion to the respective amounts which would
otherwise be payable in respect of the shares of Series A Preferred Stock held by them upon such distribution if all amounts payable
on or with respect to such shares were paid in full, and further, if upon any such liquidation, dissolution or winding up of the
Corporation the assets of the Corporation legally available for distribution to its stockholders shall be insufficient to pay
the holders of shares of Series A Preferred Stock the full amount to which they shall be entitled under this Section A.3.a,
no holder of any Junior Stock shall receive any such portion of the assets of the Corporation available for distribution to its
stockholders.
b.
Payments to Holders of Junior Stock. In the event of any voluntary or involuntary liquidation, dissolution or winding up
of the Corporation, after the payment in full of the Series A Liquidation Amount required to be paid to the holders of shares
of Series A Preferred Stock, any remaining assets of the Corporation legally available for distribution to its stockholders shall
be distributed among the holders of shares of Junior Stock, pro rata based on the number of shares held by each such holder or
otherwise in accordance with the terms of such Junior Stock.
c.
Deemed Liquidation Event.
i.
Each of the following events shall be considered a “Deemed Liquidation Event” unless the holders of
at least a majority of the outstanding shares of Series A Preferred Stock elect otherwise by written notice, sent to the Corporation
at least ten (10) days prior to the effective date of any such event:
(1)
a merger or consolidation in which: (x) the Corporation is a constituent party or (y) a subsidiary of the Corporation is a constituent
party and, in the case of this clause (y), the Corporation issues shares of its capital stock pursuant to such merger or consolidation,
except that this clause (1) shall not apply to any such merger or consolidation involving the Corporation or a subsidiary in which
the shares of capital stock of the Corporation outstanding immediately prior to such merger or consolidation that are not converted
into the right to receive cash or other securities but rather continue to represent, or are converted into or exchanged for shares
of capital stock that represent, immediately following such merger or consolidation, at least a majority, by voting power, of
the capital stock of (i) the surviving or resulting corporation or (ii) if the surviving or resulting corporation is a wholly
owned subsidiary of another corporation immediately following such merger or consolidation, the parent corporation of such surviving
or resulting corporation;
(2)
(x) the sale, lease, transfer, exclusive license or other disposition, directly or indirectly, in a single transaction or
series of transactions, by the Corporation, or any subsidiary of the Corporation, of all or substantially all of the assets
of the Corporation and its subsidiaries taken as a whole or (y) the sale or disposition (whether by merger, consolidation or
otherwise, and whether in a single transaction or a series of transactions), directly or indirectly, of one or more
subsidiaries of the Corporation, if substantially all of the assets of the Corporation and its subsidiaries taken as a whole
are held by such subsidiary or subsidiaries, except where such sale, lease, transfer, exclusive license or other disposition
is to a wholly-owned subsidiary of the Corporation;
(3)
any Bank Change of Control, but subject to the proviso in clause (ii) of that definition; or
(4)
any person (other than ABRY Senior Equity V, L.P., ABRY Senior Equity Co-Investment Fund V, L.P. and the controlled Affiliates
of Abry Partners II, LLC) or “group” of persons (as such term is defined by Rule 13d-5 of the Securities and Exchange
Act of 1934, as amended, and which “group” does not include ABRY Senior Equity V, L.P., ABRY Senior Equity Co-Investment
Fund V, L.P. or any other controlled Affiliates of Abry Partners II, LLC) becomes the “beneficial owner” (as such
term is defined by Rule 13d-3 of the Securities and Exchange Act of 1934, as amended) of equal to or greater than (x) 35.0% of
the Corporation’s then outstanding Common Stock, if any of such shares of Common Stock have been acquired from the Corporation
or any controlled Affiliate thereof, or (y) 45.0% of the Corporation’s then outstanding Common Stock.
With
respect to a Deemed Liquidation Event, “Available Proceeds” shall mean, collectively, (x) the consideration
actually received by the Corporation, if any, for such Deemed Liquidation Event (net of any retained liabilities associated with
the assets sold or technology licensed, as determined in good faith by the Board), and (y) all other assets of the Corporation
legally available for distribution to its stockholders, all to the extent permitted by law governing distributions to stockholders,
and notwithstanding Section A.3.a, payments to holders of Series A Preferred Stock, if any, in connection with such Deemed
Liquidation Event shall be made in accordance with Section A.3.c.ii.(1)-(4).
ii.
Effecting a Deemed Liquidation Event.
(1)
The Corporation shall not have the power to effect a Deemed Liquidation Event, or enter into any definitive agreement to effect
any Deemed Liquidation Event, unless the definitive agreement for such transaction (a “Definitive Agreement”)
expressly provides in form and substance reasonably acceptable to the holders of at least a majority of the outstanding shares
of Series A Preferred Stock that the consideration payable to the stockholders of the Corporation in such Deemed Liquidation Event
shall be paid, upon the consummation thereof, to the holders of capital stock of the Corporation in accordance with this Section
A.3.c.ii.
(2)
In the event of any Deemed Liquidation Event, the Corporation shall send a written notice (the “Deemed Liquidation
Event Notice”) to each holder of Series A Preferred Stock no later than the fifth (5th) business day
after the signing of a Definitive Agreement. Such Deemed Liquidation Event Notice shall include copies of any and all executed
documents in connection with and relating to the Deemed Liquidation Event, including but not limited to any and all Definitive
Agreements and any and all exhibits and disclosure schedules thereto (to be supplemented by the Corporation with any other documents
that the holders of at least a majority of the outstanding shares of Series A Preferred Stock may reasonably request from time
to time). In the event of any Deemed Liquidation Event referred to Section A.3.c.i.(1), the holders of shares of Series
A Preferred Stock then outstanding shall be entitled to be paid out of the consideration payable to stockholders in such Deemed
Liquidation Event or the Available Proceeds, as applicable, before any payment shall be made to the holders of Junior Stock by
reason of their ownership thereof, an amount per share, payable in cash, equal to the Redemption Price. In the event of any other
Deemed Liquidation Event, the Corporation shall use the Available Proceeds to redeem, immediately upon the consummation of such
Deemed Liquidation Event, all outstanding shares of Series A Preferred Stock at a price per share, payable in cash, before any
payment shall be made to the holders of Junior Stock by reason of their ownership thereof, equal to the Redemption Price. Notwithstanding
the foregoing, if upon any such Deemed Liquidation Event, the consideration payable to stockholders in such Deemed Liquidation
Event or the Available Proceeds, as applicable, shall be insufficient to pay the holders of shares of Series A Preferred Stock
the full amount to which they shall be entitled under this Section A.3.c.ii.(2), (a) the holders of shares of Series A
Preferred Stock shall share ratably in the consideration payable to stockholders in such Deemed Liquidation Event or Available
Proceeds, if applicable, in proportion to the respective amounts which would otherwise be payable in respect of the shares of
Series A Preferred Stock held by them upon such distribution or redemption if all amounts payable on or with respect to such shares
were paid in full, (b) no holder of any Junior Stock shall receive any such portion of the consideration or Available Proceeds,
as applicable, (c) a pro rata portion of each holder’s shares of Series A Preferred Stock shall be redeemed (or, in the
case of a Deemed Liquidation Event referred to in Section A.3.c.i.(1), be deemed to have been redeemed) to the fullest
extent of such consideration or Available Proceeds, as applicable, based on the respective amounts which would otherwise be payable
in respect of the shares of Series A Preferred Stock if the consideration or Available Proceeds, as applicable, were sufficient
to pay in full all amounts payable under this Section A.3.c.ii.(2) and (d) the Corporation shall redeem the remaining shares
(or, in the case of a Deemed Liquidation Event referred to in Section A.3.c.i.(1), shall cause the surviving or resulting
corporation or the parent corporation thereof to distribute such amounts as would be payable to redeem such remaining shares)
as soon as it may lawfully do so under Delaware law governing distributions to stockholders. The provisions of Sections A.6.c
and A.6.d shall apply, with such necessary changes in the details thereof as are necessitated by the context, to the
redemption of Series A Preferred Stock pursuant to this Section A.3.c. Prior to the distribution or redemption provided
for in this Section A.3.c, the Corporation shall not expend or dissipate the consideration received in such Deemed Liquidation
Event or any of the Corporation’s other assets, except to discharge reasonable transaction expenses directly incurred in
connection with such Deemed Liquidation Event. For the avoidance of doubt, the right of the holders of Series A Preferred Stock
to receive the amounts provided for in this Section A.3.c shall not be affected by the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation following any Deemed Liquidation Event.
(3)
Amount Deemed Paid or Distributed. The amount deemed paid or distributed to the holders of capital stock of the Corporation
upon any such merger, consolidation, sale, transfer, exclusive license, other disposition or redemption shall be the cash or the
value of the property, rights or securities to be paid or distributed to such holders pursuant to such Deemed Liquidation Event
as determined by the Board in good faith, provided that to the extent such property, rights or securities consist of securities
traded on an Eligible Market, the value shall be deemed to be the average of the closing prices of the securities on such Eligible
Market over the thirty (30) Trading Day period ending three (3) days prior to the closing of such Deemed Liquidation Event.
(4)
Allocation of Escrow and Contingent Consideration. In the event of a Deemed Liquidation Event, if any portion of the consideration
payable to the Corporation or to the stockholders of the Corporation is payable only upon satisfaction of contingencies, conditions
or the passage of time (the “Additional Consideration”), the Definitive Agreement shall provide that
(a) the portion of such consideration that is not Additional Consideration (such portion, the “Initial Consideration”)
shall be allocated among the holders of capital stock of the Corporation in accordance with Sections A.3.a, A.3.b
and A.3.c, as if the Initial Consideration were the only consideration payable in connection with, and shall be payable
to the holders of Series A Preferred Stock upon consummation of, such Deemed Liquidation Event and (b) any Additional Consideration
that becomes payable to the Corporation or the stockholders of the Corporation upon satisfaction of such contingencies shall be
allocated among the holders of capital stock of the Corporation in accordance with Sections A.3.a, A.3.b and A.3.c,
after taking into account the previous payment of the Initial Consideration as part of the same transaction. For the purposes
of this Section A.3.c.ii.(4), consideration placed into escrow or retained as a holdback to be available for satisfaction
of indemnification, working capital adjustments or similar obligations in connection with such Deemed Liquidation Event shall
be deemed to be Additional Consideration.
4.
Voting.
a.
General; Series A Voting Notices. The holders of Series A Preferred Stock shall be given notice by the Corporation of any
meeting of stockholders or action to be taken by written consent in lieu of a meeting of stockholders as to which the holders
of Common Stock are given notice at the same time as provided in, and in accordance with, the Bylaws; provided that notwithstanding
any such notice, except as required by applicable law or as set forth in this Section A.4, the holders of Series A Preferred
Stock shall not be entitled to vote on any matter presented to the stockholders of the Corporation for their action or consideration
unless and until any holder of Series A Preferred Stock provides written notification to the Corporation that such holder is electing,
on behalf of all holders of Series A Preferred Stock, to activate their voting rights and thereby render the Series A Preferred
Stock voting capital stock of the Corporation (such notice, a “Series A Voting Activation Notice”),
as set forth in Section A.4. From and after delivery of a Series A Voting Activation Notice, all holders of Series A Preferred
Stock shall be and continue to be entitled to vote their shares of Series A Preferred Stock in accordance with Section A.4
unless and until such time, if at all, as the holders of at least a majority of the outstanding shares of Series A Preferred
Stock provide further written notice to the Corporation that they elect to deactivate the voting rights attributable to the Series
A Preferred Stock (such notice, a “Series A Voting Deactivation Notice”); provided, however,
that neither the delivery of, or the failure to deliver, any notice under this Section A.4.a shall (i) in any way minimize
or limit, or be deemed a waiver of, any other rights, powers, entitlements or preferences with respect to their shares of Series
A Preferred Stock as set forth herein; (ii) diminish, modify or eliminate, in any way, any voting rights of the Series A Preferred
Stock other than those set forth in Sections A.4.a and A.4.b; or (iii) constitute a reduction in the voting power
of the holders of Series A Preferred Stock for any other purpose, including, without limitation, for determining the percent ownership
of the Corporation’s Common Stock on an as-converted basis, including under Section A.8. For the avoidance of doubt,
there shall be no limit on the number or type (activation or deactivation) of notices that may be delivered under this Section
A.4.a, except that a Series A Voting Deactivation Notice shall only be effective if the then most recent notice given to the
Corporation under this Section A.4.a shall have been a Series A Voting Activation Notice.
b.
Voting Rights. From and after delivery of a Series A Voting Activation Notice (unless the then most recent notice given
to the Corporation under Section A.4.a shall have been a Series A Voting Deactivation Notice), except as otherwise provided
herein, or as required by applicable law and the Listing Rules of the NASDAQ Stock Exchange, the holders of Series A Preferred
Stock shall be entitled to vote on all matters on which the holders of Common Stock shall be entitled to vote, in the same manner
and with the same effect as the holders of Common Stock, voting together with the holders of Common Stock as a single class on
an as-converted basis. As to any matter on which the holders of Series A Preferred Stock shall be entitled to vote, each holder
of Series A Preferred Stock shall be entitled to cast a number of votes per share of Series A Preferred Stock held of record by
such holder on the record date for determining the stockholders entitled to vote at the meeting of stockholders, if such matter
is subject to a vote at a meeting of stockholders, or on the record date for determining the stockholders entitled to act by written
consent, if such matter is subject to a written consent of the stockholders in lieu of a meeting of stockholders, subject to the
maximum number of votes permitted by the Listing Rules of the NASDAQ Stock Exchange, including but not limited to Rule 5640 of
the NASDAQ Listing Rules and the NASDAQ Voting Rights Policy, equal to the number of shares of Common Stock into which such shares
of Series A Preferred Stock (including any accrued but unissued PIK Shares to which the holder is entitled as of such record date,
without giving effect to any election made under Section A.2.c unless the applicable Preferred Dividend has been indefeasibly
and fully paid in cash thereunder) is then convertible on such record date in accordance with Section A.5; provided,
however, that any holder of Series A Preferred Stock shall not be entitled to cast votes for the number of shares of Common
Stock issuable upon conversion of such shares of Series A Preferred Stock held by such holder that exceeds the quotient of (1)
the aggregate Series A Issue Price for such shares of Series A Preferred Stock divided by (2) $5.57 (subject to adjustment for
stock splits, stock dividends, combinations, reclassifications and similar events, as applicable). Notwithstanding anything to
the contrary contained herein, (i) any action required or permitted to be taken by the holders of outstanding shares of Series
A Preferred Stock, voting separately as a class, may be effected by the consent in writing of the holders of at least a majority
of the total voting power of the outstanding shares of Series A Preferred Stock entitled to vote thereon, voting together as a
single class, in lieu of a duly called meeting of holders of Series A Preferred Stock; and (ii) any action required or permitted
to be taken by the holders of outstanding shares of Common Stock, whether voting separately or together with the holders of outstanding
shares of Series A Preferred Stock (provided that the holders of the Series A Preferred Stock then have the right to vote under
this Section A.4.b.) voting together with the holders of Common Stock as a single class on an as-converted basis, may be
effected by the consent in writing of (x) then current holders of outstanding shares of Series A Preferred Stock (provided that
the holders of the Series A Preferred Stock then have the right to vote under this Section A.4.b.) and/or (y) then current
holders of outstanding shares of Common Stock that are current or former holders of Series A Preferred Stock holding at least
a majority of the total voting power of the outstanding shares of Common Stock and/or Series A Preferred Stock entitled to vote
thereon, whether voting separately or voting together as a single class on an as-converted basis (as applicable), in lieu of a
duly called meeting of stockholders.
c.
Protective Provisions. At any time when shares of Series A Preferred Stock are outstanding (provided, that, if a Mandatory
Redemption Notice has been given, and any shares of Series A Preferred Stock thereafter remain outstanding, or on and after a
Redemption Failure, all shares of Series A Preferred Stock which have been redeemed, if any, shall for purposes of determining
whether either of the conditions set forth in this sentence are met, be deemed outstanding) and convertible into shares of Common
Stock equal to at least ten percent (10.0%) of the voting power of the Corporation’s Common Stock (on a fully diluted basis),
or at any time when the Requisite Investors collectively hold at least thirty-three percent (33.0%) of the aggregate amount of
Series A Preferred Stock issued to the Requisite Investors on the Original Issuance Date, the Corporation shall not, and shall
not permit any of its subsidiaries to, and neither the Corporation nor any subsidiary shall enter into any agreement to, either
directly or indirectly, by amendment, merger, consolidation or otherwise, do any of the following without (in addition to any
other vote required by law or this Certificate of Incorporation) the written consent or affirmative vote of the holders of at
least a majority of the outstanding shares of Series A Preferred Stock given in writing or by vote at a meeting, consenting or
voting (as the case may be) separately as a class, and any such act or transaction entered into without such consent or vote shall
be null and void ab initio, and of no force or effect:
i.
liquidate, dissolve or wind-up the business and affairs of the Corporation or any operating subsidiary, effect any merger, consolidation
or Deemed Liquidation Event of the Corporation or any operating subsidiary of the Corporation or consummate or agree to make any
sale, transfer, assignment, pledge, lease, license, acquisition (other than the acquisition of a Person, business or interest
therein, whether by acquisition of assets or securities, merger, consolidation, joint venture, business combination or otherwise,
that has positive consolidated earnings, before interest, taxes, depreciation and amortization (each of the foregoing calculated
in accordance with U.S. generally accepted accounting principles consistently applied) for the twelve calendar month period ending
with the last full calendar month immediately preceding the calculation thereof, and in which shares of Common Stock, Options
or Convertible Securities issued to such third party (or its equity holders) as acquisition consideration, if any, represent less
than ten percent (10.0%) of the Corporation’s then outstanding Common Stock (on a fully diluted basis)), or similar transaction
by which the Corporation or any subsidiary of the Corporation grants on an exclusive basis any rights to any of the Corporation’s
or any of a Corporation’s subsidiary’s intellectual property, or consent to any of the foregoing, except for a Deemed
Liquidation Event in which the holders of Series A Preferred Stock shall indefeasibly receive for each of their shares of Series
A Preferred Stock upon the consummation thereof, an amount in cash not less than the Redemption Price (provided, however,
that in no event, irrespective of whether consent is given under this subsection i, shall the Corporation be relieved of,
nor shall the holders of Series A Preferred Stock be deemed to have waived, the Corporation’s obligation to redeem all outstanding
shares of Series A Preferred Stock and pay the Redemption Price in accordance with Section A.3.c);
ii.
amend, alter or repeal any provision of this Certificate of Incorporation or Bylaws in a manner that adversely affects the powers,
preferences or rights of the Series A Preferred Stock, it being understood that the authorization, issuance, conversion, reclassification,
exchange or amendment of a new or existing class or series of capital stock that is, or that is convertible into, capital stock
that is pari passu or senior to the powers, privileges, preferences, rights or otherwise, of the Series A Preferred Stock
shall be deemed to adversely affect the powers, preferences or rights of the Series A Preferred Stock;
iii.
(a) (i) create, or authorize the creation of, or issue or obligate itself to issue shares of, any additional class or series of
capital stock of the Corporation unless the same (x) ranks junior to the Series A Preferred Stock with respect to the distribution
of assets on the liquidation, dissolution or winding up of the Corporation or upon a Deemed Liquidation Event, the payment of
dividends and rights of redemption and (y) is issued at fair market value as reasonably and in good faith determined by the Board,
or (ii) increase the authorized number of shares of Series A Preferred Stock (except as provided in Section A.5.c.i) or
increase the authorized number of shares of any additional class or series of capital stock of the Corporation, unless the same
ranks junior to the Series A Preferred Stock with respect to the distribution of assets on the liquidation, dissolution or winding
up of the Corporation or upon a Deemed Liquidation Event, the payment of dividends and rights of redemption or (b) create, or
authorize the creation of, or issue or obligate itself to issue shares of, any additional class or series of capital stock of
any subsidiary of the Corporation;
iv.
[intentionally omitted];
v.
purchase or redeem (or permit any subsidiary to purchase or redeem) or pay, declare or set aside any fund for, any dividend or
distribution on, any Junior Stock, other than purchases of Equity Securities upon the termination of an employee of the Corporation
or any of its subsidiaries in accordance with the terms of such employee’s employment agreement or any equity incentive
or similar plan approved by the Board;
vi.
issue any shares of Series A Preferred Stock to any individual, entity or other person other than to the Requisite Investors,
and any transferees thereof;
vii.
create, incur, grant, enter into, permit, assume or suffer to exist, directly or indirectly, (i) any indebtedness by the Corporation
(or any of its subsidiaries) or otherwise issue any Debt Securities at any time when, or as a result of which, the principal amount
of the Corporation’s total outstanding and available indebtedness and Debt Securities exceeds the product of (x) three (3)
multiplied by (y) the consolidated earnings, before interest, taxes, depreciation and amortization of the Corporation and its
subsidiaries (each of the foregoing calculated in accordance with U.S. generally accepted accounting principles) for the twelve
calendar month period ending with the last full calendar month immediately preceding the calculation thereof, (ii) any lien, charge
or other encumbrance on any of the Corporation’s (or any of its subsidiaries’) properties or assets other than Permitted
Liens (as defined in the Purchase Agreement), or (iii) guaranty the obligations of any third party;
viii.
take any actions to, or that has the effect of a, change in the size of the Board to a number other than seven (7) directors;
ix.
take any actions to relocate, or relocate, the principal executive offices of the Corporation outside of the United States;
x.
enter into any arrangement with any Affiliate or Associate of the Corporation or any subsidiary of the Corporation, or modify
any existing arrangement between the Corporation and any of its Affiliates or Associates or an existing arrangement between any
subsidiary of the Corporation and any of its Affiliates or Associates, except for transactions (x) solely between or among two
or more of the Corporation and any of its wholly-owned subsidiaries or (y) the terms and conditions of which have been determined
by the Board to be no less favorable in any material respect to the Corporation or any subsidiary of the Corporation than those
terms and conditions that would be obtained on an arm’s length basis and that does not provide for, or is not reasonably
likely to result in, aggregate payments to or by the Corporation or any subsidiary of the Corporation in excess of $1,000,000;
provided that the provisions of this subsection x shall not apply to customary director, officer, employee and consultant
compensation (including bonuses) and other employment benefits (including retirement, health, stock and other benefit plans) and
indemnification and insurance arrangements approved by the Board;
xi.
take any actions to, or otherwise, amend, modify, repeal or enter any waiver of the Credit Agreement, dated August 19, 2019, between
Powerfleet Israel Holding Company Ltd., Pointer Telocation Ltd. and Bank Hapoalim B.M., or enter into or consummate any replacement,
substitution or refinancing thereof; or
xii.
agree to, commit to, resolve to, or otherwise enter into any agreement to do any of the foregoing.
For
the avoidance of doubt, any action that is permitted under one or more of the above subsections i-xii of this Section
A.4.c, but is not permitted under any other of such subsections shall nevertheless require consent as described in this Section
A.4.c under such other subsections.
d.
Election of Directors.
i.
Subject to Section A.4.d.ii, the Board shall consist of seven (7) members or such other number as the Board and, so long
as the holders of Series A Preferred Stock are entitled to the consent right under Section A.4.c.viii above, the holders
of at least a majority of the outstanding shares of Series A Preferred Stock shall determine from time to time.
ii.
As long as any shares of Series A Preferred Stock remain outstanding and represent fifteen percent (15.0%) or more (provided,
that, if a Mandatory Redemption Notice has been given, and any shares of Series A Preferred Stock thereafter remain outstanding,
or on and after a Redemption Failure, all shares of Series A Preferred Stock which have been redeemed shall for purposes of determining
whether the conditions for the entitlement to elect one or more Series A Directors set forth in this Section A.4.d are
met, be deemed outstanding), on an as-converted basis, of the voting power of the Corporation’s Common Stock (on a fully
diluted basis), irrespective of whether or not a notice has been given to the Corporation under Section A.4.a, the holders
of at least a majority of the outstanding shares of Series A Preferred Stock, voting as a separate class, shall be entitled to
elect two (2) directors of the Corporation (the “Series A Directors”) who will serve on the Board and
who will be entitled to serve on each committee and subcommittee thereof (subject to applicable NASDAQ and SEC independence requirements).
As long as any shares of Series A Preferred Stock remain outstanding and represent less than fifteen percent (15.0%), but no less
than five percent (5.0%), on an as-converted basis, of the voting power of the Corporation’s Common Stock (on a fully diluted
basis), irrespective of whether or not a notice has been given to the Corporation under Section A.4.a, the holders of at
least a majority of the outstanding shares of Series A Preferred Stock, voting as a separate class, shall be entitled to elect
one (1) Series A Director who will serve on the Board and will be entitled to serve on each committee and subcommittee thereof
(subject to applicable NASDAQ and SEC independence requirements). For so long as any shares of Series A Preferred Stock remain
outstanding, and if there are no Series A Directors on the Board, the holders of at least a majority of the outstanding shares
of Series A Preferred Stock shall be entitled to designate one (1) non-voting observer
(an “Observer”) to attend all meetings of the Board and committees
and subcommittees thereof. The Board will give the Observer the same prior notice
given to each member of the Board in a manner permitted by the bylaws of the Corporation (as the same may be amended and/or restated
from time to time, the “Bylaws”) for notice to directors of the time and place of any proposed meeting,
and such notice in all cases shall include true and correct copies of all documents and other materials furnished to any director
in connection with such meeting. The Observer will be entitled to be present in person
or by means of telephone conference or other communications equipment by means of which all persons participating in the meeting
can hear each other, and will be entitled to participate in all discussions conducted at such meeting. The Corporation will deliver
to the Observer copies of all documents that may be distributed from time to time
to the members of the Board (in their capacity as such) at such time as such papers are so distributed to them, including copies
of any written consents, and the Observer shall otherwise be given copies of all materials, including access to all electronic
portals and materials, given or made available to other members of the Board, in order to afford the Observer the same access
as all other members of the Board. The Observer shall hold in confidence, to the
same extent required by law of the members of the Board, all documents furnished in connection with any meeting of the Board and
any committee or subcommittee thereof, and all information received through oral communication in any meeting of the Board and
any committee or subcommittee thereof and the rights of the Observer will be subject always to the rules of attorney-client privilege.
One or more investment professionals employed by the Requisite Investors shall be entitled to accompany and otherwise participate
with, the Series A Director(s) at each meeting of the Board (and committee or subcommittee thereof), provided that such investment
professionals shall hold in confidence, to the same extent required by law of the members of the Board, all documents furnished
in connection with any meeting of the Board and any committee or subcommittee thereof, and all information received through oral
communication in any meeting of the Board and any committee or subcommittee thereof and the rights of such investment professionals
will be subject always to the rules of attorney-client privilege. Notwithstanding anything to the contrary contained in this Section
A.4.d, (i) the Corporation reserves the right to withhold any information and to exclude
the Observer and any investment professionals employed by the Requisite Investors from any meeting or portion thereof if access
to such information or attendance at such meeting could reasonably be expected to adversely affect the attorney-client privilege
between the Corporation and its counsel or (ii) in the case of any committee of the Board, such committee may exclude the Observer
from any executive session of such committee at the discretion of such committee.
iii.
Any Series A Director may be removed during the aforesaid term of office, without cause, irrespective of whether or not a notice
has been given to the Corporation under Section A.4.a, by, and only by, the affirmative vote of the holders of at least
a majority of the outstanding shares of Series A Preferred Stock acting as a separate class, given either at a special meeting
of such stockholders duly called for that purpose or pursuant to a written consent of such holders. In the case of any vacancy,
howsoever arising, in the office of a Series A Director at a time when the holders of Series A Preferred Stock are entitled to
designate a Series A Director(s), irrespective of whether or not a notice has been given to the Corporation under Section A.4.a,
the holders of at least a majority of the outstanding shares of Series A Preferred Stock as a separate class shall, by affirmative
vote, be entitled to elect a successor to hold office for the unexpired term of the Series A Director whose directorship shall
be vacant. If the holders of Series A Preferred Stock fail to elect a Series A Director or to fill any vacancy in the Series A
Director directorship, then (i) such directorship shall remain vacant until such time as the holders of Series A Preferred Stock
acting as a separate class elect a person to fill such directorship, and (ii) any Series A Director then in office shall be entitled
to cast two (2) votes on every matter to be voted upon or consented to by the Board (or any committee or subcommittee thereof
on which both Series A Directors were appointed to serve).
5.
Conversion. The holders of Series A Preferred Stock shall have conversion rights as follows (the “Conversion
Rights”):
a.
Optional Right to Convert by Holders.
i.
Each share of Series A Preferred Stock shall be convertible, at the option of the holder thereof, at any time and from time to
time, and without the payment of additional consideration by the holder thereof, in whole or in part (pro rated for partial conversions),
into such number of fully paid and non-assessable shares of Common Stock equal to the quotient (rounded up to the nearest whole
number of shares) of (x) the sum of (A) the Series A Issue Price, plus (B) any Preferred Dividends (assuming a cash election were
made, whether or not permitted hereunder) accrued but unpaid thereon, whether or not declared, plus (C) the dollar amount any
other dividends declared but unpaid thereon, divided by (y) the Series A Conversion Price in effect at the time of conversion.
The “Series A Conversion Price” shall initially be equal to $7.319. The Series A Conversion Price, and
the rate at which shares of Series A Preferred Stock may be converted into shares of Common Stock, shall be subject to adjustment
as provided below. If any dividends described in clause (x)(C) are payable other than in cash, the dollar value thereof shall
be determined by the Board in good faith, without taking into account any discounts for illiquidity, marketability, minority or
similar limitations.
ii.
In order for a holder of Series A Preferred Stock to voluntarily convert shares of Series A Preferred Stock into shares of Common
Stock, such holder shall (a) provide written notice to the Corporation’s transfer agent at the office of the transfer agent
for the Series A Preferred Stock (or at the principal office of the Corporation if the Corporation serves as its own transfer
agent) that such holder elects to convert all or any number of such holder’s shares of Series A Preferred Stock and, if
applicable, any event upon which such conversion is, or such future time at which such conversion shall be, effective (a “Conversion
Notice”) and (b) if such holder’s shares are certificated, surrender the certificate or certificates
for such shares of Series A Preferred Stock (or, if such registered holder alleges that such certificate has been lost, stolen
or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation
against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate),
at the office of the transfer agent for the Series A Preferred Stock (or at the principal office of the Corporation if the Corporation
serves as its own transfer agent). Such Conversion Notice shall state such holder’s name or the names of the nominees in
which such holder desires the shares of Common Stock to be issued. If required by the Corporation, any certificates surrendered
for conversion shall be endorsed or accompanied by a written instrument or instruments of transfer, in form satisfactory to the
Corporation, duly executed by the registered holder or his, her or its attorney duly authorized in writing. The close of business
on the date of receipt by the transfer agent (or by the Corporation if the Corporation serves as its own transfer agent) of the
Conversion Notice (or as applicable, the future event or time upon which the effectiveness of the conversion was contingent) and,
if applicable, certificates (or lost certificate affidavit and agreement), shall be the time of conversion (as applicable, the
“Optional Conversion Time”), and the shares of Common Stock issuable upon conversion of the specified
shares shall be deemed to be outstanding of record as of such Optional Conversion Time.
iii.
The Corporation shall, as soon as practicable (but in no event later than three (3) business days) after the Optional Conversion
Time, issue and deliver to such holder of Series A Preferred Stock, or to his, her or its nominees, a notice of issuance of uncertificated
shares in lieu of certificates (or a certificate or certificates, if so requested by such holder) for the number of full shares
of Common Stock issuable upon such conversion in accordance with the provisions hereof and a notice of issuance of uncertificated
shares in lieu of certificates (or a certificate or certificates, if so requested by such holder) for the number (if any) of the
shares of Series A Preferred Stock represented by the surrendered certificate, if applicable, that were not converted into Common
Stock. In the event a Conversion Notice set forth any event upon which such conversion is, or such future time at which such conversion
was to be, conditioned or effective, at any time prior to the Optional Conversion Time, the holder of the Series A Preferred Stock
may revoke its Conversion Notice, by written notice to the Corporation.
b.
Mandatory Conversion by Corporation.
i.
Subject to Section A.5.b.v, beginning on or after the later of (a) the third (3rd) anniversary of the Original
Issuance Date and (b) the 30th consecutive Trading Day in which the closing price of the Common Stock exceeds the product
of (x) 1.5 multiplied by (y) the then current Series A Conversion Price, provided that the Corporation then has sufficient liquidity
and lawfully available funds to fully redeem all of the Series A Preferred Stock then outstanding in accordance with Section
6.b, the Corporation may, at its option, deliver a notice to the holders of Series A Preferred Stock (a “Mandatory
Conversion Notice”) requiring that all or a portion of the outstanding shares of Series A Preferred Stock held by
such holders automatically be converted into shares of Common Stock at the then current Series A Conversion Price as calculated
pursuant to Section A.5.a.i at a date no earlier than ninety (90) days subsequent to the receipt of the Mandatory Conversion
Notice by the holder (such date, the “Mandatory Conversion Time”). The Mandatory Conversion Notice shall
specify the Mandatory Conversion Time pursuant to this Section A.5.b. As a condition to the conversion pursuant to this
Section A.5.b.i, the Corporation shall set aside, declare and pay in full (whether by issuance of PIK Shares or, to the
extent permitted under Section A.2.c, in cash) all accrued but unpaid Dividends through the date on which the Mandatory
Conversion Time occurs, with such payment to be made by the Corporation to the applicable holders one (1) business day after such
date; provided, however, that in the event the Corporation shall issue any PIK Shares pursuant to the foregoing
clause, such PIK Shares shall be deemed to be issued as of the date on which the Mandatory Conversion Time occurs and such PIK
Shares shall automatically be converted into shares of Common Stock at the Mandatory Conversion Time.
ii.
In the event a holder of Series A Preferred Stock receives a Mandatory Conversion Notice, such holder shall have the right to
require the Corporation to redeem all or any portion (irrespective of the number of shares of Series A Preferred Stock subject
to the Mandatory Conversion Notice) of its outstanding shares of Series A Preferred Stock for cash at the Redemption Price by
delivering an Optional Redemption Notice prior to the ninetieth (90th) day following the date of the Mandatory Conversion
Notice in accordance with the procedures set forth in Section A.6 below. In the event an Optional Redemption Notice is
delivered after receipt of a Mandatory Conversion Notice, such Mandatory Conversion Notice shall be automatically, without further
action, notice or deed, rescinded and void ab initio, and the Mandatory Conversion Time shall not be deemed to occur with
respect to the shares subject to the Optional Redemption Notice.
iii.
If the holder of Series A Preferred Stock who has received a Mandatory Conversion Notice does not deliver an Optional Redemption
Notice to the Corporation prior to the ninetieth (90th) day following the date of the Mandatory Conversion Notice,
such holder of Series A Preferred Stock shall surrender his, her or its certificate or certificates for all such shares (or, if
such holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably
acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account
of the alleged loss, theft or destruction of such certificate) to the Corporation at its principal office (or such other place
as is mutually agreed between the Corporation and the holders of at least a majority of the outstanding shares of Series A Preferred
Stock). If so required by the Corporation, any certificates surrendered for conversion shall be endorsed or accompanied by written
instrument or instruments of transfer, in form reasonably satisfactory to the Corporation, duly executed by the registered holder
or by his, her or its attorney duly authorized in writing.
iv.
As soon as practicable after the Mandatory Conversion Time and, if applicable, the surrender of any certificate or certificates
(or lost certificate affidavit and agreement) for Series A Preferred Stock (but in no event later than three (3) business days
thereafter), the Corporation shall (a) issue and deliver to such holder of Series A Preferred Stock, or to his, her or its nominees,
a notice of issuance of uncertificated shares in lieu of certificates (or a certificate or certificates if so requested by such
holder) for the number of full shares of Common Stock issuable upon such conversion in accordance with the provisions hereof and
a notice of issuance of uncertificated shares in lieu of certificates (or a certificate or certificates if so requested by such
holder) for the number (if any) of the shares of Series A Preferred Stock represented by the surrendered certificate, if applicable,
that were not converted into Common Stock, and (b) pay all declared or otherwise accrued or payable but unpaid dividends on the
shares of Series A Preferred Stock converted; provided, however, that in the event the Corporation elects to pay
any dividends pursuant to the foregoing clause (b) by the issuance of PIK Shares, such PIK Shares shall be deemed to be issued
as of the date on which the Mandatory Conversion Time occurs and such PIK Shares shall automatically be converted into shares
of Common Stock at the Mandatory Conversion Time.
v.
Notwithstanding anything in this Certificate of Incorporation to the contrary, the Corporation shall not be permitted to either
issue a Mandatory Conversion Notice (or, in the case of clauses (d) or (e) below, such notice shall be automatically, without
further action, notice or deed, revoked) or require conversion of Series A Preferred Stock under this Section A.5.b if
any of the following conditions exists: (a) the Common Stock is not then listed on any Eligible Market (other than the OTC Bulletin
Board) or such other securities exchange as may be approved by the holders of at least a majority of the outstanding shares of
Series A Preferred Stock; (b) all of the shares of Common Stock issuable upon conversion are not registered for resale with the
SEC pursuant to an effective registration statement, or are not subject to resale by the holders without volume, information or
other limitations; (c) the Corporation does not have a number of authorized shares of Common Stock greater than the number of
shares of Common Stock issuable upon conversion; (d) the Corporation is then in material breach of (or has previously on more
than two (2) occasions breached) any of the provisions of this Certificate of Incorporation, including without limitation, payment
of all Dividends on the shares then being converted; (e) any of the Corporation or its subsidiaries is not then in compliance
in all material respects with all applicable laws that are material to their respective businesses; (f) if an Optional Redemption
Notice has been, or is, after receipt of a Mandatory Conversion Notice, delivered to the Corporation, but only with respect to
the shares of Series A Preferred Stock subject to such Optional Redemption Notice; (g) the Corporation is then, or at any time
after delivering the Mandatory Conversion Notice and prior to the applicable Mandatory Conversion Time, prohibited from redeeming
for cash any of the shares of Series A Preferred Stock by applicable law or the terms of any indebtedness, credit agreement, indenture
or similar instrument of the Corporation or any of its subsidiaries (without giving effect to any waiver thereof, unless such
waiver is irrevocable and has been obtained prior to the delivery of the Mandatory Conversion Notice without the payment of any
material fees) to which the Corporation or any of its subsidiaries is a party; (h) if the Corporation shall have previously issued
a Mandatory Conversion Notice for all outstanding shares of Series A Preferred Stock or (i) the Corporation does not then have
sufficient liquidity or lawfully available funds to fully redeem all of the Series A Preferred Stock then outstanding in accordance
with Section 6.b.
c.
Mechanics of Conversion.
i.
Reservation of Shares. The Corporation shall at all times when Series A Preferred Stock shall be outstanding, reserve and
keep available out of its authorized but unissued capital stock, for the purpose of effecting the conversion of Series A Preferred
Stock, such number of its duly authorized shares of Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding Series A Preferred Stock and, for the purpose of effecting the payment of any Preferred Dividend in PIK Shares,
such number of its duly authorized shares of Series A Preferred Stock as shall from time to time be sufficient to effect the issuance
of any PIK Shares as payment for a Preferred Dividend; and, if at any time the number of authorized but unissued shares of Common
Stock or Series A Preferred Stock shall not be sufficient to effect the conversion of all then outstanding shares of Series A
Preferred Stock or the issuance of PIK Shares as payment for a Preferred Dividend, through and including the sixty-six (66) month
anniversary of the Original Issuance Date (and, if any shares of Series A Preferred Stock are outstanding after the sixty-six
(66) month anniversary of the Original Issuance Date, through and including an additional period of two (2) years thereafter),
the Corporation shall take such corporate action as may be necessary to increase its authorized but unissued shares of Common
Stock or Series A Preferred Stock, as applicable, to such number of shares as shall be sufficient for such purposes, including,
without limitation, engaging in best efforts to call a meeting of the stockholders and obtain the requisite stockholder approval
of any necessary amendment to this Certificate of Incorporation. Before taking any action that would cause an adjustment reducing
the Series A Conversion Price below the then par value of the shares of Common Stock issuable upon conversion of Series A Preferred
Stock, the Corporation will take any corporate action which may, based upon the advice of its counsel, be necessary in order that
the Corporation may validly and legally issue fully paid and non-assessable shares of Common Stock at such adjusted Series A Conversion
Price.
ii.
Effect of Conversion. All rights with respect to Series A Preferred Stock converted pursuant to Section A.5.b, including
the rights, if any, to receive notices and vote (other than as a holder of Common Stock), will terminate at the Mandatory Conversion
Time (notwithstanding the failure of the holder or holders thereof to surrender any certificates at or prior to such time), except
only (x) the rights of the holders thereof, upon surrender of any certificate or certificates of such holders (or lost certificate
affidavit and agreement) therefor, to receive the items provided for in Section A.5.b.iv and (y) such rights arising out
of the failure of the Corporation to comply with all of its obligations in this Certificate of Incorporation and each other agreement
to which the Corporation, on the one hand, and the holders of Series A Preferred Stock, on the other hand and in their capacity
as such, are party. Any holder of shares of Series A Preferred Stock that have been surrendered for conversion as herein provided
shall be deemed to be the holder of the Common Stock issuable upon the conversion as of the Optional Conversion Time or Mandatory
Conversion Time, as applicable. Any shares of Series A Preferred Stock so converted shall be retired and cancelled and may not
be reissued as shares of such series and the Corporation may thereafter take such appropriate action (without the need for stockholder
action) as may be necessary to reduce the authorized number of shares of Series A Preferred Stock by an amount not in excess of
the number of surrendered shares.
iii.
No Further Adjustment. Upon any conversion of Series A Preferred Stock, no adjustment to the Series A Conversion Price
shall be made for any declared but unpaid dividends on Series A Preferred Stock surrendered for conversion, or on the Common Stock
delivered upon conversion. The holder shall be credited for any accrued but unpaid dividends at the time of conversion to be paid
in the form of, and at the time prescribed by, Section A.3.a and this Section A.5.
iv.
Taxes. The Corporation shall pay any and all issue and other similar taxes that may be payable in respect of any issuance
or delivery of shares of Common Stock upon conversion of shares of Series A Preferred Stock pursuant to this Section A.5.
The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the
issuance and delivery of shares of Common Stock in a name other than that in which the shares of Series A Preferred Stock so converted
were registered, and no such issuance or delivery shall be made unless and until the person or entity requesting such issuance
has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax
has been paid.
d.
Adjustments to Series A Conversion Price for Diluting Issues.
i.
Special Definitions. For purposes of this Section A.5.d, the following definitions shall apply:
(1)
“Option” shall mean rights, options or warrants to subscribe for, purchase or otherwise acquire Common
Stock or Convertible Securities.
(2)
“Convertible Securities” shall mean any evidences of indebtedness, shares or other securities directly
or indirectly convertible into or exchangeable for Common Stock, but excluding Options.
(3)
“Additional Shares of Common Stock” shall mean all shares of Common Stock issued (or, pursuant to Section
A.5.d.iii, deemed to be issued) by the Corporation after the Original Issuance Date, other than (x) the following shares of
Common Stock and (y) shares of Common Stock deemed issued pursuant to the following Options and Convertible Securities (clauses
(x) and (y), collectively, “Exempted Securities”):
(1)
shares of Common Stock, Options or Convertible Securities issued as a dividend or distribution on Series A Preferred Stock;
(2)
shares of Common Stock, Options or Convertible Securities issued by reason of a dividend, stock split, split-up or other distribution
on shares of Common Stock that is covered by Sections A.5.e, A.5.f, A.5.g, and A.5.h;
(3)
shares of Common Stock or Options issued as compensation for services to employees or directors of, or consultants or advisors
to, the Corporation or any of its subsidiaries pursuant to a plan, agreement or arrangement approved by the Board;
(4)
shares of Common Stock or Convertible Securities actually issued upon the exercise of Options or shares of Common Stock actually
issued upon the conversion or exchange of Convertible Securities, in each case, provided such issuance is pursuant to the terms
of such Option or Convertible Security; or
(5)
shares of Common Stock issued as acquisition consideration pursuant to the Porsche Merger Agreement or shares of Common Stock,
Options or Convertible Securities issued as acquisition consideration pursuant to the acquisition of another corporation by the
Corporation by merger, purchase of substantially all of the assets or other reorganization or to a joint venture agreement, in
each case approved by the Board and otherwise consummated in compliance with Section A.4.c.
ii.
No Adjustment of Series A Conversion Price. No adjustment to the Series A Conversion Price shall be made as the result
of the issuance or deemed issuance of Additional Shares of Common Stock if the Corporation receives written notice from the holders
of at least a majority of the outstanding Series A Preferred Stock agreeing that no such adjustment shall be made as the result
of the issuance or deemed issuance of such Additional Shares of Common Stock.
iii.
Deemed Issue of Additional Shares of Common Stock.
(1)
If the Corporation at any time, or from time to time after the Original Issuance Date shall issue any Options or Convertible Securities
(excluding Options or Convertible Securities which are themselves Exempted Securities) or shall fix a record date for the determination
of holders of any class of securities entitled to receive any such Options or Convertible Securities, then the maximum number
of shares of Common Stock (as set forth in the instrument relating thereto, assuming the satisfaction of any conditions to exercisability,
convertibility or exchangeability but without regard to any provision contained therein for a subsequent adjustment of such number)
issuable upon the exercise of such Options or, in the case of Convertible Securities and Options therefor, the conversion or exchange
of such Convertible Securities, shall be deemed to be Additional Shares of Common Stock issued as of the time of such issue or,
in case such a record date shall have been fixed, as of the close of business on such record date.
(2)
If the terms of any Option or Convertible Security, the issuance of which resulted in an adjustment to the Series A Conversion
Price pursuant to the terms of Section A.5.d.iv, are revised as a result of an amendment to such terms or any other adjustment
pursuant to the provisions of such Option or Convertible Security (but excluding automatic adjustments to such terms pursuant
to anti-dilution or similar provisions of such Option or Convertible Security) to provide for either (a) any increase or decrease
in the number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of any such Option or Convertible
Security or (b) any increase or decrease in the consideration payable to the Corporation upon such exercise, conversion and/or
exchange, then, effective upon such increase or decrease becoming effective, the Series A Conversion Price computed upon the original
issue of such Option or Convertible Security (or upon the occurrence of a record date with respect thereto) shall be readjusted
to such Series A Conversion Price as would have obtained had such revised terms been in effect upon the original date of issuance
of such Option or Convertible Security. Notwithstanding the foregoing, no readjustment pursuant to this clause (b) shall have
the effect of increasing the Series A Conversion Price to an amount which exceeds the lower of (1) the Series A Conversion Price
in effect immediately prior to the original adjustment made as a result of the issuance of such Option or Convertible Security
or (2) the Series A Conversion Price that would have resulted from any issuances of Additional Shares of Common Stock (other than
deemed issuances of Additional Shares of Common Stock as a result of the issuance of such Option or Convertible Security) between
the original adjustment date and such readjustment date.
(3)
If the terms of any Option or Convertible Security (excluding Options or Convertible Securities which are themselves Exempted
Securities), the issuance of which did not result in an adjustment to the Series A Conversion Price pursuant to the terms of Section
A.5.d.iv (either because the consideration per share (determined pursuant to Section A.5.d.v) of the Additional Shares
of Common Stock subject thereto was equal to or greater than the Series A Conversion Price then in effect, or because such Option
or Convertible Security was issued before the Original Issuance Date), are revised after the Original Issuance Date as a result
of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security (but excluding
automatic adjustments to such terms pursuant to anti-dilution or similar provisions of such Option or Convertible Security) to
provide for either (1) any increase in the number of shares of Common Stock issuable upon the exercise, conversion or exchange
of any such Option or Convertible Security or (2) any decrease in the consideration payable to the Corporation upon such exercise,
conversion or exchange, then such Option or Convertible Security, as so amended or adjusted, and the Additional Shares of Common
Stock subject thereto (determined in the manner provided in Section A.5.d.iii.(1)), shall be deemed to have been issued
effective upon such increase or decrease becoming effective.
(4)
Upon the expiration or termination of any unexercised Option or unconverted or unexchanged Convertible Security (or portion thereof)
which resulted (either upon its original issuance or upon a revision of its terms) in an adjustment to the Series A Conversion
Price pursuant to the terms of Section A.5.d.iv, the Series A Conversion Price shall be readjusted to such Series A Conversion
Price as would have obtained had such Option or Convertible Security (or portion thereof) never been issued.
(5)
If the number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of any Option or Convertible Security,
or the consideration payable to the Corporation upon such exercise, conversion and/or exchange, is calculable at the time such
Option or Convertible Security is issued or amended but is subject to adjustment based upon subsequent events, any adjustment
to the Series A Conversion Price provided for in this Section A.5.d.iii shall be effected at the time of such issuance
or amendment based on such number of shares or amount of consideration, without regard to any provisions for subsequent adjustments
(and any subsequent adjustments shall be treated as provided in clauses (2) and (3) of this Section A.5.d.iii). If the
number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of any Option or Convertible Security,
or the consideration payable to the Corporation upon such exercise, conversion and/or exchange, cannot be calculated at all at
the time such Option or Convertible Security is issued or amended, any adjustment to the Series A Conversion Price that would
result under the terms of this Section A.5.d.iii at the time of such issuance or amendment shall instead be effected at
the time such number of shares and/or amount of consideration is first calculable (even if subject to subsequent adjustments),
assuming for purposes of calculating such adjustment to such Series A Conversion Price that such issuance or amendment took place
at the time such calculation can first be made.
iv.
Adjustment of Series A Conversion Price Upon Issuance of Additional Shares of Common Stock. In the event that the Corporation
shall at any time after the Original Issuance Date issue Additional Shares of Common Stock (including Additional Shares of Common
Stock deemed to be issued pursuant to Section A.5.d.iii) without consideration, or for a consideration per share less than
the Series A Conversion Price in effect immediately prior to such issuance or deemed issuance, then the Series A Conversion Price
shall be reduced, concurrently with such issue, to a price (calculated to the nearest one-hundredth of a cent) determined in accordance
with the following formula:
CP2
= CP1* (A + B) ÷ (A + C).
For
purposes of the foregoing formula, the following definitions shall apply:
“CP2”
shall mean the Series A Conversion Price in effect immediately after such issuance, or deemed issuance, of Additional Shares of
Common Stock;
“CP1”
shall mean the Series A Conversion Price in effect immediately prior to such issuance, or deemed issuance, of Additional Shares
of Common Stock;
“A”
shall mean the number of shares of Common Stock outstanding immediately prior to such issuance, or deemed issuance, of Additional
Shares of Common Stock (treating, for this purpose, as outstanding, all shares of Common Stock issuable upon exercise of Options
outstanding immediately prior to such issuance, or deemed issuance, or upon conversion or exchange of Convertible Securities (including
the Preferred Stock) outstanding (assuming exercise of any outstanding Options therefor) immediately prior to such issuance);
“B”
shall mean the number of shares of Common Stock that would have been issued if such Additional Shares of Common Stock had been
issued or deemed issued at a price per share equal to CP1 (determined by dividing the aggregate consideration received
by the Corporation in respect of such issue by CP1); and
“C”
shall mean the number of such Additional Shares of Common Stock issued in such transaction.
v.
Determination of Consideration. For purposes of this Section A.5.d, the consideration received by the Corporation
for the issuance or deemed issuance of any Additional Shares of Common Stock shall be computed as follows:
(1)
Cash and Property. Such consideration shall (x) insofar as it consists of cash, be computed at the aggregate amount of
cash received by the Corporation, excluding amounts paid or payable for accrued interest, (y) insofar as it consists of property
other than cash, be computed at the fair market value thereof at the time of such issue, as determined in good faith by the Board
and (z) in the event Additional Shares of Common Stock are issued together with other shares or securities or other assets of
the Corporation for consideration which covers both, be the proportion of such consideration so received, computed as provided
in clauses (x) and (y) above, as determined in good faith by the Board.
(2)
Options and Convertible Securities. The consideration per share received by the Corporation for Additional Shares of Common
Stock deemed to have been issued pursuant to Section A.5.d.iii, relating to Options and Convertible Securities, shall be
determined by dividing (x) the total amount, if any, received or receivable by the Corporation as consideration for the issue
of such Options or Convertible Securities, plus the minimum aggregate amount of additional consideration (as set forth in the
instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration)
payable to the Corporation upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or
in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion
or exchange of such Convertible Securities, by (y) the maximum number of shares of Common Stock (as set forth in the instruments
relating thereto, without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon
the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible
Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities.
vi.
Multiple Closing Dates. In the event the Corporation shall issue on more than one date Additional Shares of Common Stock
that are a part of one transaction or a series of related transactions and that would result in an adjustment to the Series A
Conversion Price pursuant to the terms of Section A.5.d.iv, and such issuance dates occur within a period of no more than
ninety (90) days from the first such issuance to the final such issuance, then, upon the final such issuance, the Series A Conversion
Price shall be readjusted to give effect to all such issuances as if they occurred on the date of the first such issuance (and
without giving effect to any additional adjustments as a result of any such subsequent issuances within such period).
e.
Adjustment for Stock Splits and Combinations. If the Corporation shall at any time, or from time to time after the Original
Issuance Date, effect a subdivision of the outstanding Common Stock, the Series A Conversion Price in effect immediately before
that subdivision shall be proportionately decreased so that the number of shares of Common Stock issuable on conversion of each
share of Series A Preferred Stock shall be increased in proportion to such increase in the aggregate number of shares of Common
Stock outstanding. If the Corporation shall at any time or, from time to time after the Original Issuance Date, combine the outstanding
shares of Common Stock, the Series A Conversion Price in effect immediately before the combination shall be proportionately increased
so that the number of shares of Common Stock issuable on conversion of each share of Series A Preferred Stock shall be decreased
in proportion to such decrease in the aggregate number of shares of Common Stock outstanding. Any adjustment under this Section
A.5.e shall become effective at the close of business on the date the subdivision or combination becomes effective.
f.
Adjustment for Certain Dividends and Distributions. In the event the Corporation at any time, or from time to time after
the Original Issuance Date, shall make or issue, or fix a record date for the determination of holders of Common Stock entitled
to receive, a dividend or other distribution payable on the Common Stock in additional shares of Common Stock, then, and in each
such event, the Series A Conversion Price in effect immediately before such event shall be decreased as of the time of such issuance
or, in the event such a record date shall have been fixed, as of the close of business on such record date, by multiplying the
Series A Conversion Price then in effect for such series by a fraction:
i.
the numerator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time
of such issuance or the close of business on such record date, and
ii.
the denominator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time
of such issuance or the close of business on such record date, plus the number of shares of Common Stock issuable in payment of
such dividend or distribution.
Notwithstanding
the foregoing (a) if such record date shall have been fixed and such dividend is not fully paid or if such distribution is not
fully made on the date fixed therefor, the Series A Conversion Price for such series shall be recomputed accordingly as of the
close of business on such record date, and thereafter, the Series A Conversion Price shall be adjusted pursuant to this Section
A.5.f as of the time of actual payment of such dividends or distributions and (b) no such adjustment shall be made if the
holders of such Series A Preferred Stock simultaneously receive a dividend or other distribution of shares of Common Stock in
a number equal to the number of shares of Common Stock as they would have received if all outstanding shares of such Series A
Preferred Stock had been converted into Common Stock on the date of such event.
g.
Adjustments for Other Dividends and Distributions. In the event that the Corporation at any time, or from time to time
after the Original Issuance Date, shall make or issue, or fix a record date for the determination of holders of Common Stock entitled
to receive, a dividend or other distribution payable in securities of the Corporation (other than a distribution of shares of
Common Stock in respect of outstanding shares of Common Stock) or in other property for which Series A Preferred Stock does not
receive a dividend or distribution pursuant to the terms of this Certificate of Incorporation, then, and in each such event, the
holders of Series A Preferred Stock shall receive, simultaneously with the distribution to the holders of Common Stock, a dividend
or other distribution of such securities or other property in an amount equal to the amount of such securities or other property
as they would have received if all outstanding shares of Series A Preferred Stock had been converted into Common Stock on the
date of such event.
h.
Adjustment for Merger or Reorganization, etc. If there shall occur any reorganization, recapitalization, reclassification,
consolidation or merger involving the Corporation in which Common Stock (but not Series A Preferred Stock) is converted into or
exchanged for securities, cash or other property (other than a transaction covered by Section A.3.c.(1), A.5.d,
A.5.f or A.5.g) then, following any such reorganization, recapitalization, reclassification, consolidation or merger,
each share of Series A Preferred Stock not so converted or exchanged shall thereafter be convertible in lieu of the Common Stock
into which it was convertible prior to such event into the kind and amount of securities, cash or other property which a holder
of the number of shares of Common Stock of the Corporation issuable upon conversion of one share of Series A Preferred Stock immediately
prior to such reorganization, recapitalization, reclassification, consolidation or merger would have been entitled to receive
pursuant to such transaction; and, in such case, appropriate adjustment (as determined in good faith by the Board) shall be made
in the application of the provisions in this Section A.5 with respect to the rights and interests thereafter of the holders
of Series A Preferred Stock, to the end that the provisions set forth in this Section A.5 (including provisions with respect
to changes in and other adjustments of the Series A Conversion Price) shall thereafter be applicable, as nearly as reasonably
may be, in relation to any securities or other property thereafter deliverable upon the conversion of such Series A Preferred
Stock.
i.
Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment of the Series A Conversion Price
pursuant to this Section A.5, the Corporation at its expense shall, as promptly as reasonably practicable, but in any event
not later than ten (10) days thereafter, compute such adjustment or readjustment in accordance with the terms hereof and furnish
to each holder of Series A Preferred Stock a certificate setting forth such adjustment or readjustment (including the kind and
amount of securities, cash or other property into which such Series A Preferred Stock is convertible) and showing in reasonable
detail the facts upon which such adjustment or readjustment is based. The Corporation shall, as promptly as reasonably practicable
after the written request at any time of any holder of Series A Preferred Stock (but in any event, not later than ten (10) days
thereafter), furnish or cause to be furnished to such holder a certificate setting forth (i) the Series A Conversion Price then
in effect and (ii) the number of shares of Common Stock and the amount, if any, of other securities, cash or property which then
would be received upon the conversion of Series A Preferred Stock.
j.
Notice of Record Date. In the event (i) the Corporation shall take a record of the holders of its Common Stock (or other
capital stock or securities at the time issuable upon conversion of Series A Preferred Stock) for the purpose of entitling or
enabling them to receive any dividend or other distribution, or to receive any right to subscribe for or purchase any shares of
capital stock of any class or any other securities, or to receive any other security, (ii) of any capital reorganization of the
Corporation, any reclassification of the Common Stock of the Corporation, or any Deemed Liquidation Event or (iii) of the voluntary
or involuntary dissolution, liquidation or winding-up of the Corporation, then, and in each such case, the Corporation will send
or cause to be sent to the holders of Series A Preferred Stock a notice specifying, as the case may be, (x) the record date for
such dividend, distribution or right, and the amount and character of such dividend, distribution or right, or (y) the effective
date on which such reorganization, reclassification, Deemed Liquidation Event, dissolution, liquidation or winding-up is proposed
to take place, and the time, if any is to be fixed, as of which the holders of record of Common Stock (or such other capital stock
or securities at the time issuable upon the conversion of Series A Preferred Stock) shall be entitled to exchange their shares
of Common Stock (or such other capital stock or securities) for securities or other property deliverable upon such reorganization,
reclassification, Deemed Liquidation Event, dissolution, liquidation or winding-up, and the amount per share and character of
such exchange applicable to Series A Preferred Stock and Common Stock. Such notice shall be sent at least ten (10) days prior
to the record date or effective date for the event specified in such notice.
6.
Redemption.
a.
Mandatory Redemption by Corporation.
i.
Subject to Section A.6.a.iv, the Corporation shall have the right to redeem all (but not less than all) of the shares of
Series A Preferred Stock at any time after the third (3rd) anniversary of the Original Issuance Date by delivering
a Mandatory Redemption Notice to each holder of the then outstanding shares of Series A Preferred Stock. On the date of payment
provided in the Mandatory Redemption Notice (the “Mandatory Redemption Date”), the Corporation shall
redeem all outstanding shares of Series A Preferred Stock for cash and the Corporation shall deliver to each holder of the then
outstanding shares of Series A Preferred Stock an amount in cash equal to the aggregate Redemption Price (where the reference
date is the Trading Day immediately prior to the date of the Mandatory Redemption Notice) for the shares of Series A Preferred
Stock owned by such holder, from funds legally available therefor.
ii.
The Corporation shall send written notice of the mandatory redemption (the “Mandatory Redemption Notice”)
to each holder of the then outstanding shares of Series A Preferred Stock not less than sixty (60) nor greater than ninety (90)
days prior to the Mandatory Redemption Date. The Mandatory Redemption Notice shall state:
(1)
the number of shares of Series A Preferred Stock held by such holder, all of which the Corporation shall redeem on the Mandatory
Redemption Date (to be not less than all of the shares of Series A Preferred Stock held by such holder);
(2)
the Mandatory Redemption Date, which shall be a business day selected by the Corporation not less than sixty (60) and not greater
than ninety (90) days subsequent to the date of the Mandatory Redemption Notice, and the Redemption Price; and
(3)
for holders holding shares in certificated form, that such holder is to surrender to the Corporation, in the manner and at the
place designated, his, her or its certificate or certificates representing the shares of Series A Preferred Stock to be redeemed,
provided, that, the place of surrender shall be the Corporation’s principal office, unless the holders of at least a majority
of the outstanding shares of Series A Preferred Stock and the Corporation have previously agreed in writing to a different place.
iii.
Upon indefeasible receipt of the full Redemption Price in cash by the holders of the then outstanding shares of Series A Preferred
Stock, all shares of Series A Preferred Stock shall cease to be outstanding.
iv.
Notwithstanding anything in this Certificate of Incorporation to the contrary, the Corporation shall not be permitted to either
issue a Mandatory Redemption Notice (or, in the case of clauses (a) or (b) below, such notice shall be automatically, without
further action, notice or deed, revoked) or consummate a mandatory redemption of Series A Preferred Stock under this Section
A.6.a if any of the following conditions exists: (a) the Corporation is then in material breach of (or has previously on more
than two (2) occasions materially breached) any of the provisions of this Certificate of Incorporation (it being understood that
the failure to timely pay in full any Preferred Dividends shall be deemed a material breach of this Certificate of Incorporation),
including without limitation, payment of all Dividends on the shares then being redeemed; (b) the Corporation is at the time of
delivering the Mandatory Redemption Notice, or at any time after delivering the Mandatory Redemption Notice and on or prior to
the applicable Mandatory Redemption Date, prohibited from redeeming for cash any of the shares of Series A Preferred Stock by
applicable law or the terms of any indebtedness, credit agreement, indenture or similar instrument of the Corporation or any of
its subsidiaries (without giving effect to any waiver thereof, unless such waiver is irrevocable and has been obtained prior to
the delivery of the Mandatory Redemption Notice without the payment of any material fees) to which the Corporation or any of its
subsidiaries is a party; or (c) the Corporation shall have previously issued a Mandatory Redemption Notice.
b.
Optional Redemption by Holders.
i.
Each holder of outstanding shares of Series A Preferred Stock shall have the right to require the Corporation to redeem all or
any portion of its outstanding shares of Series A Preferred Stock (x) at any time and from time to time after the sixty-six (66)
month anniversary of the Original Issuance Date, or (y) following delivery of a Mandatory Conversion Notice, or (z) in connection
with, and (except in the case of a Bank Change of Control described in clause (i)(x) of the definition thereof, but subject to
the proviso in clause (ii) of the definition thereof) conditioned upon, the occurrence of a Deemed Liquidation Event, by delivering
written notice thereof to the Corporation (the “Optional Redemption Notice”) which, in the case of clause
(x) above, may be delivered as early as the sixtieth (60th) month anniversary of the Original Issuance Date. Such Optional
Redemption Notice shall specify whether it is being delivered pursuant to clause (x), (y) or (z) of this Section A.6.b.i,
the number of shares of Series A Preferred Stock to be redeemed, the date on which such redemption shall occur (which in the case
of clause (x) shall not be less than six (6) months after the date of the Optional Redemption Notice (and the reference date with
respect to the Redemption Price payable shall be the Trading Day immediately prior to the date of the Optional Redemption Notice),
and in the case of clause (y) shall not be less than sixty (60) days after the date of the Mandatory Conversion Notice (and the
reference date shall be the Trading Day immediately prior to the date of the Mandatory Conversion Notice), and in the case of
clause (z), shall be no later than simultaneously with, and (except in the case of a Bank Change of Control described in clause
(i)(x) of the definition thereof, but subject to the proviso in clause (ii) of the definition thereof) shall be conditioned upon,
consummation of the Deemed Liquidation Event, such redemption date, the “Optional Redemption Date”)
and that the certificates, if any, of the shares being redeemed shall be surrendered at the Corporation’s principal office,
unless the Corporation and such holder shall have mutually agreed in writing to a different place. On the Optional Redemption
Date, the Corporation shall redeem the shares of Series A Preferred Stock in cash specified in the Optional Redemption Notice(s)
and, simultaneously, the Corporation shall deliver to each holder who has then delivered an Optional Redemption Notice the aggregate
Redemption Price in cash, from funds legally available therefor, for each share of Series A Preferred Stock subject to such Optional
Redemption Notice. Notwithstanding the foregoing, if on the Optional Redemption Date, applicable law governing distributions to
stockholders prevents either (x) the Board from authorizing redemption or (y) the Corporation from redeeming all shares of Series
A Preferred Stock at the aggregate Redemption Price for such shares, then the Corporation shall ratably redeem the maximum number
of shares of Series A Preferred Stock that it is permitted to redeem under such law at the aggregate Redemption Price, and shall
redeem the remaining shares as soon as it may lawfully do so under such law. If a holder of Series A Preferred Stock does not
elect to send an Optional Redemption Notice in connection with a Deemed Liquidation Event, such holder shall not be deemed to,
and shall not, have waived its rights, or in any way impaired its right to payment, under Section A.3.c.
ii.
In the event all holders of the then outstanding shares of Series A Preferred Stock deliver an Optional Redemption Notice with
respect to all then outstanding shares of Series A Preferred Stock pursuant to Section A.6.b.i.(x), and if the Corporation
(x) has not redeemed all of the shares of Series A Preferred Stock subject to the Optional Redemption Notice on the applicable
Optional Redemption Date, and (y) such redemption process, including the payment of the aggregate Redemption Price payable, has
not been completed on the six (6) month anniversary thereof (such anniversary, a “Redemption Failure”),
then the holders of at least a majority of the outstanding shares of Series A Preferred Stock shall have the right to initiate,
conduct and direct, through majority vote of the Transaction Committee (but subject to Board approval of the Selected Bid as provided
in this Section A.6.b.ii below), a customary sale process of the entire Corporation and its subsidiaries, or such lesser
portion thereof as the Transaction Committee shall deem appropriate (a “Sale Transaction”) to be conducted
by a special committee of the Board consisting of one non-Series A Director selected by the Board and the Series A Directors (the
“Transaction Committee”). The Transaction Committee will have the authority to, among other things,
(a) engage financial advisors and/or investment bankers on behalf of, in the name of and at the expense of (including the payment
of fees, expenses and customary financial advisor indemnification), the Corporation, (b) determine the process for conducting
the Sale Transaction, including selecting the parties to participate in such process, the right to accept or reject any offers,
and the timing thereof, (c) review, mark-up, comment on and negotiate the definitive agreements for such Sale Transaction, (d)
communicate with the purchaser parties and/or their representatives and participate in meetings with them, and (e) determine the
structure and terms of the Sale Transaction, in each case in its sole discretion in consultation with its advisors. Within thirty
(30) days (or such later date as is approved by the Transaction Committee) after a Redemption Failure, the Transaction Committee
shall engage an investment bank with reasonable experience in selling companies in the Corporation’s industry and shall
execute the engagement letter for such engagement on behalf of the Corporation. Such engagement shall be negotiated by the Transaction
Committee. The fees, expenses and indemnity obligations payable to such investment bank shall be borne solely and exclusively
by the Corporation. However, the investment bank shall be engaged by and report directly to the Transaction Committee. If the
Transaction Committee receives one or more bids from a potential buyer to engage in a Sale Transaction, in each case, whether
pursuant to the sale process or otherwise during the thirteen (13) months after the Optional Redemption Date, then the Transaction
Committee shall make a determination as to which bid to select among all the bids received (even if only one bid is received)
(such bid and the transactions contemplated thereby, collectively, the “Selected Bid”) and shall recommend
the Selected Bid to the full Board for review and determination. If the Selected Bid is approved by the Board, the Board shall
recommend to the Corporation’s stockholders that such holders approve the Selected Bid and adopt the definitive agreement
for the Selected Bid, as applicable, in accordance with applicable law, and shall direct that the Selected Bid and the definitive
agreement for the Selected Bid, as applicable, be submitted to the Corporation’s stockholders for adoption.
iii.
If the Board fails to approve the Selected Bid for any reason or the Selected Bid is not consummated within thirteen (13) months
after the Optional Redemption Date (the “Sale Period”), the Transaction Committee may terminate the
sale process, and at any time thereafter as it deems appropriate, reinstate the sale process set forth in this Section A.6.b
with the same or a new investment bank, as it shall determine.
c.
Surrender of Certificates; Payment. On or before the applicable Mandatory Redemption Date or Optional Redemption Date,
each holder of shares of Series A Preferred Stock to be redeemed on such Mandatory Redemption Date or Optional Redemption Date,
unless such holder has exercised his, her or its right to convert such shares as provided in Section A.5, shall, if a holder
of shares in certificated form, surrender the certificate or certificates representing such shares (or, if such registered holder
alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable
to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged
loss, theft or destruction of such certificate) to the Corporation, in the manner and at the place designated in the Mandatory
Redemption Notice or Optional Redemption Notice, and thereupon the Redemption Price for such shares shall be payable in cash to
the order of the person whose name appears on such certificate or certificates as the owner thereof. In the event less than all
of the shares of Series A Preferred Stock represented by a certificate are redeemed, a book entry (or a new certificate, if so
requested by such holder) representing the unredeemed shares of Series A Preferred Stock shall promptly be issued to such holder.
d.
Rights Subsequent to Redemption. If the Mandatory Redemption Notice or Optional Redemption Notice shall have been duly
given, and if on the applicable Mandatory Redemption Date or Optional Redemption Date, the Redemption Price payable upon redemption
of the shares of Series A Preferred Stock to be redeemed on such Mandatory Redemption Date or Optional Redemption Date is indefeasibly
paid or tendered for payment or deposited with an independent payment agent so as to be available therefor in a timely manner,
then notwithstanding that any certificates evidencing any of the shares of Series A Preferred Stock so called for redemption shall
not have been surrendered, dividends with respect to such shares of Series A Preferred Stock shall cease to accrue from and after
such Mandatory Redemption Date or Optional Redemption Date, and all rights with respect to such shares shall forthwith after the
Mandatory Redemption Date or Optional Redemption Date terminate, except only the right of the holders to receive the Redemption
Price without interest upon surrender of any such certificate or certificates therefor.
7.
Redeemed or Otherwise Acquired Shares. Any shares of Series A Preferred Stock that are redeemed or otherwise acquired by
the Corporation or any of its subsidiaries shall be automatically and immediately cancelled and retired and shall not be reissued,
sold or transferred as shares of such series. Neither the Corporation nor any of its subsidiaries may exercise any voting or other
rights granted to the holders of Series A Preferred Stock following redemption.
8.
Preemptive Rights.
a.
For so long as at least twenty-five percent (25.0%) of the aggregate amount of Series A Preferred Stock issued on the Original
Issuance Date continues to be outstanding, each holder thereof shall be entitled to participate in each of the Corporation’s
future offerings of Equity Securities and Debt Securities (other than asset-based lending or credit facilities with money-center
commercial banks) (as the case may be, “Additional Securities”) in accordance with this Section A.8.
Such participation will be allocable on a pro rata basis among the holders of Series A Preferred Stock according to their then-ownership
of Series A Preferred Stock. Notwithstanding anything in this Certificate of Incorporation to the contrary, the Corporation shall
not issue any Equity Securities or Debt Securities (other than asset-based lending or credit facilities with money-center commercial
banks) without first complying with this Section A.8.
b.
Each time the Corporation proposes to offer any Additional Securities, the Corporation shall first offer the Additional Securities
to each holder of Series A Preferred Stock in accordance with the following provisions:
i.
The Corporation shall deliver a notice (the “Issuance Notice”) to the holders of Series A Preferred
Stock as soon as practicable after the Board has resolved to offer such Additional Securities stating (i) its bona fide intention
to offer such Additional Securities, (ii) the number of such Additional Securities to be offered, (iii) the price and terms, if
any, upon which it proposes to offer such Additional Securities and (iv) the anticipated closing date of the sale of such Additional
Securities (such notice shall be delivered no later than thirty (30) days before such anticipated closing date); and
ii.
By written notification delivered to the Corporation within twenty (20) days after the date of the Issuance Notice, any holder
of Series A Preferred Stock may elect to purchase, at the same price and on the same terms specified in the Issuance Notice, a
number of Additional Securities specified in the Issuance Notice in accordance with the following. If any Additional Securities
being offered are Equity Securities, a holder of Series A Preferred Stock may elect to purchase up to, as determined by such holder,
a number of such Additional Securities so that immediately after the issuance of all Additional Securities then being offered,
such holder’s voting power is equal to such holder’s voting power immediately prior to the issuance of such Additional
Securities (voting power is based upon the number of votes such holder is entitled to cast, counting all Equity Securities held
by such holder, when voting together with the Common Stock relative to the total number of votes of Common Stock, inclusive of
all classes and series that vote together with the Common Stock as a single class, that may be cast) (the proportion of such Equity
Securities the holder is entitled to purchase, such holder’s “Pro Rata Share”). If the Additional
Securities being offered are Debt Securities, a holder of Series A Preferred Stock may elect to purchase up to, as determined
by such holder, a number of such Additional Securities having a principal amount (disregarding any original issuance discount)
or purchase price, as applicable, equal to such holder’s Pro Rata Share. Notwithstanding the foregoing, the Corporation
and the holders of at least a majority of the outstanding shares of Series A Preferred Stock may mutually agree that the holders
of Series A Preferred Stock shall be entitled to purchase an amount of the Additional Securities then being offered in excess
of the aggregate Pro Rata Shares of all such holders, up to the full amount of the Additional Securities being offered.
c.
Any Additional Securities issued pursuant to this Section A.8 to any holder of Series A Preferred Stock shall be purchased
at the same price sold by the Corporation in connection with such issuance of Additional Securities, or, if the price to be paid
by a purchaser is consideration other than cash, then at a cash price which is substantially equal in value to such other consideration
as determined in good faith by the Board. The closing of the offering of Additional Securities shall take place on the anticipated
closing date set forth in the Issuance Notice, or such later date, and on such additional or different terms, as may be mutually
agreed by the Corporation and the holders of at least a majority of the outstanding shares of Series A Preferred Stock.
d.
Any Additional Securities included in an Issuance Notice that are not purchased by the holders of Series A Preferred Stock may
be sold by the Corporation to any third parties, but not on price or other material terms or conditions that are less favorable
to the Corporation, either individually or in the aggregate, than those offered to the holders of Series A Preferred Stock. If
the closing of the offering of Additional Securities does not occur within one hundred twenty (120) days after the delivery of
the Issuance Notice, such Issuance Notice shall be void, and the Corporation shall once again be required to comply with this
Section A.8 by re-offering any, or different, Additional Securities to the holders of Series A Preferred Stock in accordance
with this Section A.8.
e.
The rights of holders of Series A Preferred Stock under this Section A.8 shall not apply to: (i) the conversion of Series
A Preferred Stock; (ii) the exercise of any compensatory options to acquire Common Stock outstanding on the date this Certificate
of Incorporation is filed with the Secretary of State of the State of Delaware; (iii) the issuance of Common Stock, stock awards
or options under or the exercise of any options granted pursuant to, any employee stock option or similar employee incentive or
benefit plan for the issuance of stock awards, options or capital stock of the Corporation approved by the Board; (iv) the issuance
of shares of Common Stock or Preferred Stock pursuant to a stock split, stock dividend, combination or subdivision of the outstanding
shares of Common Stock or Preferred Stock (as the case may be) approved by the Board; (v) any offering of Additional Securities
expressly waived in writing by the holders of at least a majority of the outstanding shares of Series A Preferred Stock, which
waiver may be given in such holders sole and absolute discretion; (vi) any registered public offering of Common Stock; or (vii)
any issuance of Exempted Securities.
9.
Waiver. Any of the rights, powers, preferences and other terms of the Series A Preferred Stock set forth herein may be
waived on behalf of all holders of Series A Preferred Stock by the affirmative written consent or vote of the holders of at least
a majority of the outstanding shares of Series A Preferred Stock.
10.
Notices. Any notice required or permitted to be given to a holder of shares of Series A Preferred Stock shall be mailed,
postage prepaid, to the post office address last shown on the records of the Corporation or given by electronic communication
in compliance with the provisions of the General Corporation Law of the State of Delaware, and shall be deemed given upon such
mailing or direction to such holder by electronic transmission in the manner permitted by the General Corporation Law of the State
of Delaware.
B.
COMMON STOCK
The
rights, preferences, privileges, restrictions and other matters relating to the Common Stock are as follows:
1.
Dividends. Subject to the prior rights of holders of all classes of stock at the time outstanding having prior rights as
to dividends and the applicable terms of this Certificate of Incorporation, the holders of Common Stock shall be entitled to receive,
when, as and if declared by the Board, out of any assets of the Corporation legally available therefor, such dividends as may
be declared from time to time by the Board.
2.
Liquidation Rights. Upon any voluntary or involuntary liquidation, dissolution or winding up of the Corporation or a Deemed
Liquidation Event or otherwise, holders of Common Stock shall be entitled to receive all of the assets of the Corporation available
for distribution to its stockholders, subject to any preferential or pari passu rights of any then outstanding Preferred
Stock.
3.
Voting Rights. Except as otherwise provided by the General Corporation Law of the State of Delaware or this Certificate
of Incorporation and subject to the rights of holders of Preferred Stock, the holder of each share of Common Stock shall have
the right to one vote, and shall be entitled to notice of any stockholders’ meeting in accordance with the Bylaws, and shall
be entitled to vote upon such matters and in such manner as may be provided by law. Notwithstanding any other provision of this
Certificate of Incorporation to the contrary, the holders of Common Stock shall not be entitled to vote on any amendment to this
Certificate of Incorporation (including any certificate of designation in respect of any series of Preferred Stock) that relates
solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled,
either separate or together as a class with the holders of one or more such other series, to vote thereon pursuant to this Certificate
of Incorporation or the General Corporation Law of the State of Delaware.
SIXTH.
The election of directors need not be by written ballot unless the Bylaws shall so require.
SEVENTH.
Subject to any additional vote required by this Certificate of Incorporation, the Board is expressly authorized to adopt, amend
or repeal the Bylaws. Notwithstanding the foregoing, such power shall not divest or limit the power of the stockholders of the
Corporation to adopt, amend or repeal the Bylaws.
EIGHTH.
Unless otherwise set forth herein, a majority in voting power of directors present at a meeting at which a quorum is present shall
be the act of the Board. Unless otherwise set forth herein, each director shall have one (1) vote on all matters to be voted on
by the Board or any committee thereof.
NINTH.
A director of the Corporation shall not be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except to the extent that exculpation from liability is not permitted under the General Corporation Law of
the State of Delaware as in effect at the time such liability is determined. No amendment or repeal of this Article Ninth shall
apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect to any
acts or omissions of such director occurring prior to such amendment or repeal.
TENTH.
Whenever a compromise or arrangement is proposed between the Corporation and its creditors or any class of them and/or between
the Corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Delaware may,
on the application in a summary way of the Corporation or of any creditor or stockholder thereof or on the application of any
receiver or receivers appointed for the Corporation under the provisions of Section 291 of Title 8 of the Delaware Code or on
the application of trustees in dissolution or of any receiver or receivers appointed for the Corporation under the provisions
of Section 279 of Title 8 of the Delaware Code, order a meeting of the creditors or class of creditors, and/or of the stockholders
or class of stockholders, of the Corporation, as the case may be, to be summoned in such manner as the said court directs. If
a majority in number representing three-fourths in value of the creditors or class of creditors, and/or of the stockholders of
class of stockholders, of the Corporation, as the case may be, agree to any compromise or arrangement and to any reorganization
of the Corporation as a consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors,
and/or on all the stockholders or class of stockholders, of the Corporation, as the case may be, and also on the Corporation.
ELEVENTH.
The following indemnification provisions shall apply to the persons enumerated below.
A.
Right to Indemnification of Directors and Officers. The Corporation shall indemnify and hold harmless, to the fullest extent
permitted by applicable law as it presently exists or may hereafter be amended, any person (an “Indemnified Person”)
who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a “Proceeding”), by reason of the fact that such person,
or a person for whom such person is the legal representative, is or was a director or officer of the Corporation or any subsidiary
of the Corporation or, while a director or officer of the Corporation or such subsidiary, is or was serving at the request of
the Corporation or such subsidiary as a director, officer, employee or agent of another corporation or of a partnership, joint
venture, limited liability company, trust, enterprise or nonprofit entity, including service with respect to employee benefit
plans, against all liability and loss suffered and expenses (including attorneys’ fees) reasonably incurred by such Indemnified
Person in such Proceeding. Notwithstanding the preceding sentence, except as otherwise provided in Section C of this Article
Eleventh, the Corporation shall be required to indemnify an Indemnified Person in connection with a Proceeding (or part thereof)
commenced by such Indemnified Person only if the commencement of such Proceeding (or part thereof) by the Indemnified Person was
authorized in advance by the Board.
B.
Prepayment of Expenses of Directors and Officers. The Corporation shall pay the expenses (including attorneys’ fees)
incurred by an Indemnified Person in defending any Proceeding in advance of its final disposition, provided, however,
that, to the extent required by law, such payment of expenses in advance of the final disposition of the Proceeding shall be made
only upon receipt of an undertaking by the Indemnified Person to repay all amounts advanced if it should be ultimately determined
that the Indemnified Person is not entitled to be indemnified under this Article Eleventh or otherwise.
C.
Claims by Directors and Officers. If a claim for indemnification or advancement of expenses under this Article Eleventh
is not paid in full within thirty (30) days after a written claim therefor by the Indemnified Person has been received by the
Corporation, the Indemnified Person may file suit to recover the unpaid amount of such claim and, if successful in whole or in
part, shall be entitled to be paid the expense of prosecuting such claim. In any such action the Corporation shall have the burden
of proving that the Indemnified Person is not entitled to the requested indemnification or advancement of expenses under applicable
law.
D.
Indemnification of Employees and Agents. The Corporation may indemnify and advance expenses to any person who was or is
made or is threatened to be made or is otherwise involved in any Proceeding by reason of the fact that such person, or a person
for whom such person is the legal representative, is or was an employee or agent of the Corporation or, while an employee or agent
of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation
or of a partnership, joint venture, limited liability company, trust, enterprise or nonprofit entity, including service with respect
to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees) reasonably incurred
by such person in connection with such Proceeding. The ultimate determination of entitlement to indemnification of persons who
are non-director or officer employees or agents shall be made in such manner as is determined by the Board in its sole discretion.
Notwithstanding the foregoing sentence, the Corporation shall not be required to indemnify a person in connection with a Proceeding
initiated by such person if the Proceeding was not authorized in advance by the Board.
E.
Advancement of Expenses of Employees and Agents. The Corporation may pay the expenses (including attorneys’ fees)
incurred by an employee or agent in defending any Proceeding in advance of its final disposition on such terms and conditions
as may be determined by the Board.
F.
Non-Exclusivity of Rights. The rights conferred on any person by this Article Eleventh shall not be exclusive of any other
rights which such person may have or hereafter acquire under any statute, provision of this Certificate of Incorporation, the
Bylaws, agreement, vote of stockholders or disinterested directors or otherwise.
G.
Other Indemnification. The Corporation’s obligation, if any, to indemnify any person who was or is serving at its
request as a director, officer or employee of another corporation, partnership, limited liability company, joint venture, trust,
organization or other enterprise shall be reduced by any amount such person may collect as indemnification from such other corporation,
partnership, limited liability company, joint venture, trust, organization or other enterprise.
H.
Insurance. The Board may, to the full extent permitted by applicable law as it presently exists, or may hereafter be amended
from time to time, authorize an appropriate officer or officers to purchase and maintain at the Corporation’s expense insurance:
(i) to indemnify the Corporation for any obligation which it incurs as a result of the indemnification of directors, officers
and employees under the provisions of this Article Eleventh; and (ii) to indemnify or insure directors, officers and employees
against liability in instances in which they may not otherwise be indemnified by the Corporation under the provisions of this
Article Eleventh.
I.
Amendment or Repeal. Any repeal or modification of the foregoing provisions of this Article Eleventh shall not adversely
affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the time of such repeal
or modification. The rights provided hereunder shall inure to the benefit of any Indemnified Person and such person’s heirs,
executors and administrators.
TWELFTH.
To the maximum extent permitted from time to time under the law of the State of Delaware, the Corporation renounces any interest
or expectancy of the Corporation in, or in being offered an opportunity to participate in, business opportunities that are from
time to time presented to the Series A Directors or any holder of Series A Preferred Stock (or Common Stock issuable upon the
conversion of Series A Preferred Stock) or any partner, manager, member, director, officer, stockholder, employee, agent or Affiliate
of any such holder. Any amendment or repeal of this Article Twelfth shall only be prospective and shall not affect the rights
under this Article Twelfth in effect at the time of the occurrence of any actions or omissions to act giving rise to any liability
or alleged liability or with respect to any opportunities of which such persons become aware prior to such amendment or repeal.
THIRTEENTH.
The books of the Corporation may be kept outside the State of Delaware as may be designated by the Board or in the Bylaws.
FOURTEENTH.
Any action required or permitted to be taken by the stockholders of the Corporation must be effected at a duly called annual or
special meeting of stockholders of the Corporation and may not be effected by any consent in writing by such stockholders. Special
meetings of stockholders of the Corporation may be called only by (i) the Board pursuant to a resolution adopted by a majority
of the entire Board, either upon motion of a director or upon written request by the holders of at least fifty percent (50%) of
the voting power of all the shares of capital stock of the Corporation then entitled to vote generally in the election of directors,
voting together as a single class or (ii) the chairman of the Board or the chief executive officer of the Corporation.
FIFTEENTH.
In addition to any requirements of the General Corporation Law of Delaware (and notwithstanding the fact that a lesser percentage
may be specified by the General Corporation Law of Delaware), the affirmative vote of the holders of at least 75% of the voting
power of all of the shares of capital stock of the Corporation then entitled to vote generally in the election of directors, voting
together as a single class, shall be required for the stockholders of the Corporation to amend, alter, change, adopt or repeal
Article Fourteenth or Article Fifteenth hereof.
SIXTEENTH.
Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware
(the “Court of Chancery”) shall be the sole and exclusive forum for any stockholder (including a beneficial
owner) to bring (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim
of breach of fiduciary duty owed by any current or former director, officer or other employee or stockholder of the Corporation
to the Corporation or the Corporation’s stockholders, (iii) any action asserting a claim arising pursuant to any provision
of the General Corporation Law of the State of Delaware or this Certificate of Incorporation or the Bylaws or as to which the
General Corporation Law of the State of Delaware confers jurisdiction on the Court of Chancery or (iv) any action asserting a
claim governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim as to which the Court
of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the
indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten (10) days following such
determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which
the Court of Chancery does not have subject matter jurisdiction. This provision will not apply to claims arising under the Securities
Act of 1933, as amended, the Exchange Act or other federal securities laws for which there is exclusive federal or concurrent
federal and state jurisdiction. If any provision or provisions of this Article Sixteenth shall be held to be invalid, illegal
or unenforceable as applied to any person or entity or circumstance for any reason whatsoever, then, to the fullest extent permitted
by law, the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions
of this Article Sixteenth (including, without limitation, each portion of any sentence of this Article Sixteenth containing any
such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) and
the application of such provision to other persons or entities and circumstances shall not in any way be affected or impaired
thereby. Any person or entity purchasing or otherwise acquiring or holding any interest in shares of capital stock of the Corporation
shall be deemed to have notice of and consented to the provisions of this Article Sixteenth.
5.
This Amended and Restated Certificate of Incorporation, which restates and integrates and further amends the provisions of this
Corporation’s Initial Certificate of Incorporation, has been duly adopted in accordance with Sections 242 and 245 of the
General Corporation Law of the State of Delaware.
[Remainder
of page intentionally left blank.]
IN
WITNESS WHEREOF, the Corporation has caused this Amended and Restated Certificate of Incorporation to be signed by a duly authorized
officer of the Corporation this 2nd day of October, 2019.
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POWERFLEET,
INC. |
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|
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By: |
/s/
Chris Wolfe |
| |
Name: |
Chris
Wolfe |
| |
Title: |
Chief
Executive Officer and President |
